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EVOLUTION OF THE BUDGET 
IN MASSACHUSETTS 



THE MACMILLAN COMPANY 

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SPECIAL STUDIES IN ADMINISTRATION 

By The Bureau of Municipal Research and The Training School for Public Service 



Evolution of the Budget 
in Massachusetts 



BY 
LUTHER H. GULICK 



THE MACMILLAN COMPANY 
1920 

All rights reserved 



<3 



Copyright, 1920, 
By the MACMILLAN COMPANY. 



Printed from type. Published May, 1920. 



MAV ko IddO 



J. S. Gushing Co. — Berwick & Smith Co. 
Norwood, Mass., U.S.A. 



©CI.A570155 



1 



PREFACE 

This historical sketch of the development of the budget 
in Massachusetts is an outgrowth of a brief outline pre- 
pared for Representative Joseph E. Warner during the 
fall of 191 7, when the author was the secretary of the 
Joint Special Committee on Finance and Budget Pro- 
cedure of the Massachusetts General Court. It is not 
the purpose of this discussion to prove or disprove any 
of the current budget dogmas, but solely to record in 
orderly fashion the long series of events that have led up 
to the present budget system of Massachusetts. The 
reformer who looks for immediate and revolutionary 
changes in the financial methods will find little consola- 
tion in the history of Massachusetts. For this very 
reason, the student of government who believes there is 
some value in the gradual growth of the habits and forms 
of government, will see, it is hoped, a justification for this 
presentation of the evolution of the budget in Massa- 
chusetts. 

The author has several debts to acknowledge. Rep- 
resentative Benjamin Loring Young^has been a most 
helpful and constructive critic. Mr. Carl A. Raymond, 
Deputy Supervisor of Administration, and Mr. Louis A. 
Phillips, Legislative Reference Librarian, have rendered 
valuable assistance. The acute criticisms of Professor 



vi PREFACE 

Thomas Reed Powell and the suggestions and advice of 
Professor Howard Lee McBain, both of Columbia Uni- 
versity, have guided the author in shaping the material 
of this study. Lest others may be charged with responsi- 
bility for statements of fact and of judgment contained 
in these pages, it is only fair to state that as the author 
has not in all cases been guided by his counselors, the 
responsibility is his and his alone. 

L. H. G. 
New York, 
March, 1920. 



PREFATORY NOTE 

This volume is the second in a series of special studies 
in administration in course of preparation by the Bureau 
of Municipal Research and Training School for Public 
Service, as announced in the first volume by Dr. C. C. 
Maxey, "County Administration — A Study Based 
Upon a Survey of County Government in the State of 
Delaware.'' 

Although Mr. Gulick's treatment is for the most part 
historical, the writing of history has not been his purpose. 
On the contrary, it is his intention to present for the 
practical administrator dealing with state budgets an 
account of actual appropriation methods and the practice 
prevailing under an important piece of budget legislation. 

Not the least of his purposes has been to counteract the 
superficial views which prevail in some quarters as to 
budget-making. There are some who write and speak 
as if "a budget system" could be established overnight 
by a mere act of the legislature imposing on some body 
or authority responsibility for preparing estimates of 
expenditures and revenues. In reality budget-making is 
a complicated process. In installing a budget system 
we are not confronted with the relatively easy task of 
adding a wing to an old structure, or of devising a new 
bureau or office of government. On the contrary we are 



viii PREFATORY NOTE 

brought face to face with operations as complex as the 
multifarious activities of modem government and with 
processes which go to the very root of our constitutional 
law and political custom. If any one is under the delusion 
that the governor of the state or the President of the 
United States can on his own motion introduce a "budget 
system" by expanding his message into a monumental 
fiscal statement or by recommending the adoption of an 
act of appropriation prepared in executive chambers, it 
would be well for him to rid himself of that delusion 
immediately. If any one thinks that a mere statute 
requiring an executive consolidation of estimates is suffi- 
cient to install a "budget system," he also is in error. 
Above all, it is a travesty upon the term to give the name 
"budget law" to an act which merely equips legislative 
committees with staffs of searchers. 

It might as well be said, once for all, that a budget system 
involves fundamental executive and legislative practices, 
carefully devised accounting methods, adequate expert 
service, efficient record keeping and work reporting — 
in short, all of the processes of good management. This 
is so in England, it is so in Germany, it is so in France, it 
is so in Japan, in Canada, and in every country where 
a budget system is in operation, even though there are, 
of course, certain differences in procedure. It involves 
an abandonment on the part of the pubHc of the tradi- 
tional attitude that the treasury exists for the satisfaction 
of local needs. It involves the training of public servants 
equipped to operate a system based on sound business 



PREFATORY NOTE ix 

principles. Whoever expects, therefore, to rush a " budget 
biU'' through the coming legislature and to see an im- 
mediate revolution in finances, is destined to be disap- 
pointed. Advocates of a budget system have before 
them a season of scientific research into accounting and 
reporting methods, civil service practices, public works 
management, cost measurement and record keeping. 
Moreover, they have before them a long campaign of 
public education. 

Mr. Gulick's study is merely an eloquent commentary 
illustrated by a wealth of detail on the principles laid 
down above. As such it will be welcomed I am convinced 
by those men of affairs who are actually wrestling with 
the problem of installing sound budget practices in 
detail. 

Charles A. Beard, 

Director, Bureau of Municipal Research, 
and Training School for Public Service . 



CONTENTS 

OHAFTEB FAOa 

I. Before the Constitution i 

Charter Provisions ; The Executive-Legislative Struggle ; 
Development of Legislative Control ; Underlying Causes. 

n. First Steps under the Constitution, i 780-1849 . . 11 
The New Constitution ; The Budget of 1780 ; Legislative 
Committees of 1780; Development of "Rolls"; Appro- 
priations ; Position of Legislative Committees ; Position 
of the Governor. 

III. Laying the Budget Foundations, 1849-1910 . . 25 

Creation of the Auditor; Preparation of Estimates; 
Appropriations ; The Authorization of Transfers ; Grow- 
ing Importance of Committees; Increased Leadership 
of the Governor ; Development of Financial Control. 

IV. The Governor and the Budget, 1910-1918 . . .42 

Part I. Budget Reform in 1910 and its Results — The 
Walker Act; Governor's New Responsibility Recog- 
nized in Republican Platform; Democratic Governor 
Elected ; Governor Foss and the Walker Act ; Governor 
Authorized to Employ Experts; Governor's Recom- 
mendations and Legislative Revision ; Results of Execu- 
tive Participation in Appropriation Process; Party 
Platforms of 191 1 ; Creation of Commission on Economy 
and Efficiency; Estimates to Auditor; Governor 
Eliminated from Appropriation Process; Supervisor of 
Administration Replaces Commission; Ultimate Result 
of Walker Act. 

Part II. Budget Reform in 191 7 — Report of Economy 
and Efficiency Commission; Report on Revenues and 
Loans ; Chamber of Commerce Report ; The Legislature 
and Budget Reform. 



XU CONTENTS 

CHAPTER PAGE 

V. The Joint Special Committee on Finance and Budget 

Procedure 71 

Composition of Committee ; Sub-committee on the Budget. 
Part I. Preparation of the Budget for 191 8 — Staff 
Assistance of Supervisor; Institutional Visits; Confer- 
ences; Budget Policy; The Subcommittee's Budget; 
Budget Submitted to Legislature; The Massachusetts 
Budget of 1918 ; Supporting Details. 
Part II. Providing for a Budget System — Budget Views 
of Committee Members ; Budget Program of Mr, Warner 
and Mr. Young; Time Limit Forces Decision; The 
Budget Recommendations of the Recess Committee. 

VI. The Legislature of 191 8 and the Budget . . . 94 
Governor McCall and Speaker Cox Advocate the Budget 
System ; Budget Progress in the Legislature ; Legislative 
Consideration of the 191 8 Budget ; Pubhc Interest in the 
Budget ; Conflict with Senate Over Committee Reference ; 
Budget Revisions of the House Committee; Revised 
Budget Bill Before the House; Budget Bill Before the 
Senate; Significant Incidents in the Passage of the 
Budget Bill ; Disposition of Postponed Items ; Budget 
Recommendations for Capital Outlays; Relation of 
Budget Appropriation to Total Appropriations; Ap- 
propriation Bills of 191 8; Appropriations for Metro- 
politan Districts ; Early Passage of Appropriation Acts ; 
General Satisfaction with New Budget System. 

VII. Establishing the Budget System 117 

Part I. The Budget System Bill — Committee Recom- 
mendations; Referred to Joint Ways and Means Com- 
mittee ; Lack of Interest in Budget System ; Passage of 
the Bill. 

Part 11. Other Financial Reforms in 1918 — Minor 
Recommendations of Recess Committee; Salary Stand- 
ardization and the Administrative Control of Appoint- 
ments and Promotions ; Transfers of Funds Appropriated 
for State Departments. 



CONTENTS xiii 

CHAPTER [page 

VIII. The Constitutional Convention and the Budget . 129 
Part I. The First Session of the Convention, 19 17 — 
The Budget Resolutions Submitted ; Hearings Before the 
Committee on Finance ; Report of Committee. 
Part 11. The Second Session of the Constitutional 
Convention, 1918 — Committee Report Before the 
Convention; Debate on the Executive; Committee on 
Finance Changes Its Mind ; Debate on the Budget ; 
The Convention's Address to the People ; Ratification 
by the People ; Analysis of Vote. 

IX. Experience with the Budget in 1919 .... 162 
Form of Estimate Blanks for State Departments; 
Preparation of the Budget by the Supervisor of Ad- 
ministration ; the Governor's Submission of the Budget ; 
Budget Recommendations of Inaugural Address ; Forms 
and Content of the 1919 Budget ; Legislative Considera- 
tion of the 1919 Budget; The Budget Speech; News- 
paper Comment on Budget Speech; Debate on the 
Budget Bill in the House ; The Budget Bill Before the 
Senate; Supplementary Budgets; The Budget and the 
Pork-Barrel; Appropriations Based on the Governor's 
Special Messages ; Private Petitions for Appropriations ; 
Total Appropriations of 19 19 Session. 

X. Budget Reform in 1919 . 194 

New Constitutional Provisions ; Changes in Budget Law 
and Practice ; Reorganization of the Executive Depart- 
ments ; The Reorganization Act ; Effect of Reorganiza- 
tion on the Budget. 

XL Constitutional Conflict over the Budget in 1920 . 207 
Preparation and Submission of the Budget ; The 1920 
Budget; The Expenditure Program; The Revenue 
Program; Budget Before Joint Committee on Ways 
and INIeans ; Results of Financial Inquiries ; Opinion of 
the Attorney-General ; Public Criticism of the Governor's 
Budget ; The Governor's Revised Budget ; Restoration 
of the Constitutional Principle of Executive Responsibility. 



xiv CONTENTS 

CHAPTER PAGE 

XII. Classification of the Massachusetts Budget System 224 
Classification of Budget Systems; Classification of the 
Massachusetts Budget System. 

XIII. Outstanding Facts in the Evolution of the Massa- 
chusetts Budget . . . . . . .228 

Evolution of Estimates; Authorization; Audit of Ex- 
penditures; Execution; The Dynamic of Budget Re- 
form; Legislative Leadership; The Limits of Public 
Interest; The Influence of the Budget Environment: 
Three Years of Budget Experience; The Value of the 
Budget System; The Need of a Budget Staff; The 
Failure of Massachusetts Provisions to Make the Gov- 
ernor Responsible for the Budget ; The Permanency of 
the New Budget System. 

Appendix I. The Budget Amendment of the Massachusetts 

Constitution 239 

Appendix II. The Massachusetts Budget Act . . 241 



EVOLUTION OF THE BUDGET 
IN MASSACHUSETTS 



EVOLUTION OF THE BUDGET 
IN MASSACHUSETTS 

CHAPTER I 

BEFORE THE CONSTITUTION 

When the patriots of Massachusetts Bay resisted the 
imposition of a tax on tea by a government in which they 
had no voice, they were expressing a pohtical axiom well 
rooted in the hearts and pockets of our ancestors. Tax- 
ation and representation belonged together. It was one 
of the ideas that came over in the Arabella in the spring 
of 1630 when the government of Masasachusetts was 
brought from England to this continent.^ 

The idea that taxation and representation belonged 
together was the more firmly fixed because of the long 
conflict that had been waged between the royal governors 
and the elected representatives of the colonists. 

Charter Provisions. 

In 1 69 1 William and Mary granted Massachusetts a 

new charter. The frame of government, in the words of 

the charter, was as foUows : 

"And Wee doe further for Vs Our Heires and Successors 
Will Establish and ordeyne that from henceforth for ever there 

1 Manual of Constitutional Convention, 191 7, page 6. 

B I 



2 BUDGET IN MASSACHUSETTS 

shall be one Governor One Leivtent or Deputy Governor and 
One Secretary of Our said Province or Territory to be from 
time to time appointed and Commissionated by Vs Our Heires 
and Successors and Eight and Twenty Assistants or Councillors 
to be advising and assisting to the Governor. . . . And further 
Wee Will and by these presents for Vs Our Heires and Succes- 
sors doe ordeyne and Grant that there shall and may be con- 
vened held and kept by the Governor for the time being. ... a 
great and General Court of Assembly Which said Great and 
General Court of Assembly shall consist of the Governor and 
Councill or Assistants for the time being and of such Freeholders 
of Our said Province or Territory as shall be from time to time 
elected or deputed by the Major parte of the Freeholders and 
other Inhabitants of the respective Townes or Places. . . ." 

The legislative power conferred on the general court 
was to enact ^'wholesome and reasonable laws," to "name 
and settle Annually all Civill Officers," to define their 
duties and powers, and 

"to Impose and levy proportionable and reasonable Assess- 
ments Rates and Taxes upon the Estates and Persons of all 
and every the Proprietors and Inhabitants of our said Terri- 
tory to be disposed of by Warrant under the hand of the Gov- 
ernor . . . with the advice and Consent of the Councill for 
Our service in the necessary defense and support of our Govern- 
ment of our said Territory and the Protection and Preserva- 
tion of the Inhabitants there according to such acts as are or 
shall be in force within our said Province and to dispose of 
matters and things whereby our Subjects inhabitants of our 
said Province may be Religiously peaceably and Civilly Gov- 
erned Protected and defended soe as their good life and orderly 
Conversation may win the Indians natives of the Country to 
the knowledge and-obedience of the onely true God and Saviour 
of Mankind. . . . ** 



I 



BEFORE THE CONSTITUTION 3 

It was also provided that the governor should have 
the veto power, that all laws should be sent to England 
for a further approval, and that the councillors should 
be elected by the Great General Court.^ 

The Executive-Legislative Struggle, 

This charter with its grant of the money power to the 
people's representatives formed the basis of the long strug- 
gle between the house and the governor, a struggle which 
is too well known to need any comment here.^ It is suf- 
ficient for oxu" purposes to point out the saHent results of 
the struggle. These were : 

1. The wide separation of the executive and legislative 
departments. 

2. The absolute control of the people's representa- 
tives over the levy of taxes and the appropriation of 
funds. 

3. The gradual assumption of executive power by the 
legislature through the agency of its financial control. 

4. The estabKshment of the principle that financial 
measures must originate with the "people's representa- 
tives" — the lower house. 

5. The evolution of a "legislative budget" as a 
means of restricting the executive and keeping taxes 
down. 

* Charter of 1691. 

«H. R. Spencer, "Constitutional Conflict in Provincial Massachusetts." 
Charles H. J. Douglas, "Financial History of Massachusetts from 
1620 to 1775." Charles Bullock, "Finances of the United States 1775 to 
1789.'? 



4 BUDGET IN MASSACHUSETTS 

Incidents in the Struggle, 

This conflict brought forth many exceedingly interest- 
ing incidents. So hostile were the representatives to va- 
rious royal governors that they decreased their salaries, 
which were voted annually, and even went so far in the 
bitterest fights as to make no grants whatsoever. 

Phips, the first royal governor, wrote to the home 
government "no salary was allowed or was intended,'' 
and asked the king to interfere.^ Dudley, the third gov- 
ernor, demanded the enactment of a permanent salary, 
only to be informed by the house, "As to settling a salary 
for the governor, it is altogether new to us ; nor can we 
think it agreeable to our present constitution ; but we 
shall be ready to do what may be proper for his support." ^ 
In 1720 Elisha Cooke, the leader of the "country party, '' ^ 
was elected speaker of the house. Governor Shute dis- 
allowed the selection, but the house paid no attention. 
The governor then dissolved the assembly.^ When the 
new house met in July, the representatives took vengeance 
by cutting in half the gratuity voted annually to the 
governor's father, and in the following year decreased the 
governor's salary.* 

It is to be noted that the power over the governor's 
salary was used as a club and that up to 1735 the grant 
was customarily postponed to the last day of the session.'* 
Indeed, in 1721 the house refused to proceed to the passage 

* Bancroft, Vol. II, page 68. ^ Spencer, page 66. 
3 Letter of Shute to Board of Trade, June i, 1721, Vol. 13, X. 24. 

* Bancroft, Vol. II, page 246. 



BEFORE THE CONSTITUTION 5 

of money bills till the governor notified them that he 
had approved the acts, resolves and elections of the 
session.^ 

The gradual encroachment by the legislature on the 
executive power was the cause of continued friction almost 
from 1 69 1 to 1775. More than one governor complained 
bitterly to the home government. Governor Shute 
made the charge to the king in 1723 that the house had 
given orders to garrisons, examined and disposed of mili- 
tary supplies, discharged individual officers for poHtical 
reasons, and determined the number and ranks of armed 
men he might maintain.^ 

Perhaps the keenest complaint of all, however, was 
that of Governor Belcher in a letter dated December 26, 
1732, to Newcastle, in which he said : 

"All the struggle in that matter is for power; if every ac- 
count of the Province must be subjected to the House of 
Representatives the King's Governor will be of very little 
signification. They that have control of the money will 
certainly have the power, and I take the single question on 
this head to be whether the King shall appoint his own Gover- 
nor or whether the House of Representatives shall be Governor 
of the Province." 3 

Douglas, who condemns the tactics of the representa- 
tives in his financial history of Massachusetts, regards 
the financial struggle as part of the American Revolution.^ 

1 Spencer, page 66. 2 /^j^f.^ page 124, 

^ December 26, 1732, Belcher Papers, page 493. 

^ Douglas, Financial History of Massachusetts, pages 57, 137, 



6 BUDGET IN MASSACHUSETTS 

The Origination and Amendment of Money Bills. 

There was also a long-continued conflict between the 
house of representatives and the coimcil over the amend- 
ment of money bills. In 1746, for example, the council 
altered the tax bill sent up to them by the house. It 
was returned, and the journal of the house reads : "Read 
and non-concurred. For as much as the House appre- 
hend the honorable Board (according to the constant 
usage of the General Court and ancient privilege of the 
Representatives of the People) may only concur or non- 
concur a Tax Bill, but may not make any amendment. '* 
L On June 21st, the council persisted in amending the 
bill, and on the 24th the house refused to accept any 
amendment made by the council. Finally, on the 26th 
the council gave in, at the same time notifying the house, 
— "Although the Board apprehend they have a just right 
to make an amendment on a Tax Bill, at least in a matter 
circumstantial, which was the point in dispute between 
the two Houses on the present Tax Bill ; yet rather than 
delay the important business of the Court at this critical 
juncture, the Board have concurred the Tax Bill as sent 
up by the Honorable House. ^^ Nevertheless, the council, 
that very afternoon, amended an appropriation (supply) 
bill and sent it down. Again the house non-concurred 
and sent a message to the board, saying: "It is very 
surprising to the House, that the Honorable Board should 
in their vote of this day begin a grant of a great expense 
to this Province ; for how reasonable soever the par- 
ticulars voted may be, yet this House apprehend such 



BEFORE THE CONSTITUTION 7 

grants should always originate with the People, who are 
at the cost of them." 

This struggle between the two houses was settled by 
the constitution in 1780 with its provision that — "All 
rhoney bills shall originate in the House of Representa- 
tives ; but the Senate may propose or concur with amend- 
ments as on other bills/' — a phrase which found its way 
into the federal Constitution in 1787.^ 

Development of Legislative Control, 

Paralleling this struggle for financial control by the 
representatives of the people, there was a gradual develop- 
ment of the machinery of financial control. In the earh- 
est days there were no separate appropriation acts, strictly 
speaking, for the right to spend was included in the right 
to collect. The revenues were raised by grants of direct 
and indirect taxes "For the Defence of his Majesty's 
subjects and interests," and for other equally vague and 
general purposes. The revenue measures of a year were 
from three to six in number. They had no relation with 
each other, and no attempt was made to consider the 
financial problem as a whole and to plan accordingly.^ 

The revenue system of the province, coupled with the 
growing financial leadership of the house of representa- 
tives, brought about a significant change. The revenue 
needed was raised from two sources, direct taxes and 

^Gilpin, Madison Papers, pages 1 530-1 531; Massachusetts Constitution, 
Part II, Chap. I, sec. Ill, Art. VII. 

' See Province Laws and Resolves, Vol. I to V. 



8 BUDGET IN MASSACHUSETTS 

indirect taxes.^ The fact that the indirect taxes failed 
to meet the needs of the government made it necessary 
to fall back each year on polls and property taxes to be 
apportioned on the various towns. The representatives 
were sent by these towns and so had a lively appreciation 
of the unpopularity of direct taxes and as a result were 
always eager to prevent any expenditure that could pos- 
sibly be avoided. To make the expenditures for a given 
year as low as possible, they finally brought all the matters 
together in a single bill, paring it down to the lowest pos- 
sible figure and insisting that the council could not amend 
it in any particular, nor introduce any other measures. 
This evolution of a "legislative budget, '' in which expendi- 
tures and revenue were balanced over against each other 
with great care, was complete by 1733. In that year 
practically the entire running expenses of the government 
were fixed and financed by a single bill entitled "An Act 
for Supplying the Treasury with the Sum of Seventy-Six 
Thousand Five Hundred Pounds, Bills of Credit, for Dis- 
charging the Public Debt, &c., and for establishing the 
Wages of Sundry Persons, &c., in the Service of the Prov- 
ince." This combined appropriation and revenue bill 
provided : 

1. Fixed salaries for the soldiers of the province. 

2. That seventy-six thousand five hundred pounds 
should be issued in bills of credit, — "all sums shall be 
employed for the necessary defence and support of this 

1 Douglas, Financial History of Massachusetts, 32, [33 ^59-95 ; Bullock 
Finances of the U. S. i775-89> ^ul. University of Wisconsin, pages 224-226. 



BEFORE THE CONSTITUTION 9 

government, viz., eight thousand one hundred and sixty- 
two pounds twelve shillings, part thereof, shall be applied 
to pay the wages and other sums now due or that may 
be due by virtue of the estabHshment of Castle Williams 
as above, and to and for no other purpose whatsoever. ..." 
In similar fashion the other appropriations follow, each 
concluded by the clause ^'and to and for no other purpose 
whatsoever." 

3. Pay for the councillors and for the representatives. 

4. '^That if there be a surplusage in any sum appro- 
priated, such surplusage shall ly(e) in the treasury for 
further order of this court." 

5. That the bills of credit issued be redeemed by poll 
and property taxes as they fell due over a period of years.^ 

By 1733, then, the legislature had adopted a " segregated 
budget," in modern parlance, and had carefully guarded 
the surpluses by making them lapse into the treasury. 

This unity of financial planning continued, except for 
an upset at the time of the colonial wars, till 1775, when 
the war financing, both state and national, upset all 
orderly procedure. The period falling between 1733 
and 1775 displays at times a unity of financial planning 
exceedingly refreshing to the present-day student of pubHc 
finance.^ 

Underlying Causes. 

It is an interesting phase of budgetary history that in 
provincial Massachusetts a unified financial program 

1 Province'Laws, Vol, 11, page 690. ^!^i774 Province Laws, V, page 390. 



lO BUDGET IN MASSACHUSETTS 

was developed as early as 1733. A careful study of the 
forces that brought it about lead to the conclusion that 
it was a result of the conflicting political interest of the 
peoples' representatives and the royal governors. A uni- 
fied financial plan was found to be the most efficient way 
of tying down the executive and limiting the direct taxes. 
Professor Bullock writes in his monograph on the Fi- 
nances of the United States, 1775 to 1789 : "It is probably 
safe to attribute the growth of a unified budget in this 
colony (Massachusetts) to the calculating and parsimo- 
nious character of the policy of the representatives. This 
conclusion does not necessarily exclude all possibility 
of an influence having been exerted by the example of 
English methods. But it does seem certain that within 
the colony itself existed conditions which are a sufficient 
explanation of the course of budgetary development.'* ^ 

* Bui. U. of Wisconsin, Vol. i, page J28. 



CHAPTER II 

FIRST STEPS UNDER THE CONSTITUTION 
1780 TO 1849 

The New Constitution. 

The Massachusetts constitution of 1780 was the handi- 
work of John Adams as modified by the elected repre- 
sentatives of the freemen of the state. ^ It preserved most 
of the old institutions and made changes only where 
necessary to correct Provincial abuses, or to replace the 
British crown. 

The sections of the constitution affecting finances and 
financial control were copied almost word for word from 
the charter of 1691 — with the omission of the religious 
and missionary phrases.^ The veto power was left with 
the governor,^ the executive duties of the old council were 
turned over to the new council,^ while the legislative duties 
of the old council went to the senate.^ The power to 
originate money bills was 'left with the house, though 
the senate, now elective, was given power to amend.^ 
The issuance of moneys from the treasury was made 
dependent, as under the charter, upon a warrant signed 
by the governor.^ 

* Convention Manual 191 7, page 22. ^ paj-^ n gg^. I^ Article IV. 

3 Part II, Chap. I, sec. I, Article II. * Ihid., Chap. II, sees. I-III. 

5 Ihid., Chap. I, sec. II. « Ihid., Chap. I, sec. Ill, Article VII. 

Uhid., Chap. II, sec. I, Article XI. 



12 BUDGET IN MASSACHUSETTS 

Article XIII of the section dealing with the governor 
is interesting in view of the historical experiences of the 
province. It provides : 

"As the public good requires that the governor should not be 
under the undue influence of any of the members of the general 
court by a dependence on them for support, that he should 
in all cases act with freedom for the benefit of the pubKc, that 
he should not have his attention necessarily diverted from that 
object to his private concerns, and that he should maintain the 
dignity of the commonwealth in the character of its chief 
magistrate, it is necessary that he should have an honorable 
stated salary, of a fixed and permanent value, amply sufficient 
for those purposes, and established by standing laws : and it 
shall be among the first acts of the general court after the com- 
mencement of this constitution, to establish such salary by 
law accordingly." 

From a financial standpoint, the only important change 
brought about by the new constitution was the estabhsh- 
ment of a popularly elected governor, and even this inno- 
vation had little effect for the time being because of the 
ingrained jealousy of executive power. 

The Budget of I'jSo. 

During the Revolution all orderly finance disappeared, 
and it is not surprising to find a disorganized system in 
1780. In the first session of the general court after the 
adoption of the new constitution there were eight acts 
and 157 resolves of a budgetary nature. If any financial 
plan had been adopted for the session, certainly no evi- 
dence of it is to be found in the number or sequence of 
the acts and resolves carrying a charge upon the treasury 



FIRST STEPS UNDER THE CONSTITUTION 13 

Summary Table from the Budget of lySo. 

The sums necessary for the services of the current year (exclu- 
sive of raising the men and the supply of beef, respectively 
assessed upon the towns) are as follows : 

For shirts, shoes and stockings for the Massachusetts line .... £20,200 

To pay for clothing from Europe, already purchased, and charges . 6,000 

To import clothing from ditto 20,000 

To pay for officers clothing, now due to them 12,000 

To discharge part of the principal of the public debt 50,000 

To purchase small stores for the army 11,000 

Money required by Congress for payment of the troops, etc. . . . 86,000 

Ditto, to discharge Quarter-Master's certificates 64,000 

To discharge interest on the depreciation notes, and such of them as 

become due in a few days 9S,ooo 

To pay interest on the securities of government 118,000 

For the support of civil government 30,000 

For the Commissary-General's office 30,000 

For the supplies of forts and garrisons 40,000 

To discharge the debts due from the late Board of War .... 12,500 

To pay interest on hard money notes 6,000 

To procure 13,000 bushels of salt 9j75o 

Ditto — 74,500 gallons of rum 18,625 

For redeeming one-seventh part of the new money 66,000 

To procure 2000 barrels of pork 16,000 

To pay for transportation of rum, salt and pork 16,000 

Money for sundry charges of the war, not enumerated 212,000 

(in specie . . £939>o7S 

Amounting in the whole to nine hundred and thirty-nine thousand 
and seventy-five pounds, in specie. The means for payment of 
which, as we conceive, may best be obtained in the following 
manner 

By loan on the supply biU £400,000 

The silver money tax now collecting 72,000 

The surplus of beef, appropriated to the supply of pork .... 16,000 
By the shoes, stockings, etc., proportionably levied on the several 

towns 20,200 

By the sale of confiscated estates 40,000 

By excise on articles of consumption 50,875 

By a tax on poUs and estates 320,000 

By a lottery for the purchase of clothing 20,000 

(in specie . - . £939,075 



14 BUDGET IN MASSACHUSETTS 

or providing funds for the treasury. But on February 
27, 1 781, about the middle of the first session of the gen- 
eral court, a summary budget statement was prepared 
and ordered printed and publicly distributed.^ This 
statement, in addition to the summary estimates of 
expenditures and revenues, contains an explanation of 
the revenue measures, of some of the appropriations 
called for, and concludes with a discussion of the state 
debt and a ringing appeal to the patriotism of the people 
for support of a public loan. The financial balance sheet 
of this " budget'^ is reprinted on page 13. 

Legislative Committees of lySo. 

In addition to handling many matters directly, the 
general court appointed a number of committees and 
individuals to which were appropriated lump simis for 
the discharge of obligations of the government. 

Among these committees were the committee for 
superintending purchases (R. Chap. 8, Oct.), the board 
of war (R. Chap. 10, Oct.), the committee to superintend 
the purchase of beef (R. Chap. 16, Oct.), the committee 
for methodizing and stating accounts (R. Chap. 20, 
Oct.), the committee for settling with the army (R. 
Chap. 21, Oct.), and the committee to conciu* and pay 
accounts (R. Chap. 11, Oct.). All of these, but one, 
were carried over from the pre-constitutional days and 
in some cases were instructed "to proceed in their busi- 
ness according to the several directions of former general 

' Resolves of 1780, Chapter 162. 



FIRST STEPS UNDER THE CONSTITUTION 15 

courts." ^ Others were not formally reappointed or 
reinstructed, but continued and acted as before.^ 

The most interesting of these committees from the 
budgetary standpoint is the committee to concur and pay 
accounts. It was an innovation created by resolve Chap- 
ter II, of November 4, 1780, as follows : 

^^ Resolved J That Richard Cranch, Lemuel Kollock, Joseph 
Hosmer^ Jonathan Webster, and Noah Goodman, Esqu'rs, be, 
and they are hereby appointed a committee on the part of this 
House, whose business it shall be to receive, examine, and pass 
on all accounts (not otherwise ordered) which shall be exhib- 
ited to them for allowance, for any service done in persuance 
of any resolve or order of the General Court, provided such 
accounts be properly vouched and authenticated, and the 
dooings of said committee respecting such accounts, or any 
three of them (who are hereby appointed a quorum) shall be 
considered as valid as any vote or resolve of this house, during 
the recess as well as in the sitting of the General Court. 

"And it is further Resolved, That Jabez Fisher and Ephraim 
Starkweather, Esq'rs. shall be a committee on the part of the 
Senate, and they are hereby authorized and empowered, both 
in the sitting and recess of the General Court, to concur and 
pay aU such accounts as shaU have been allowed by the com- 
mittee of the House as aforesaid, always taking proper vouchers 
for the same. 

*'And it is further Resolved, That there be paid out of the 
public treasury to said committee of the Senate, a sum not 
exceeding two thousand pounds in the new emission of money, 
to enable them to pay off accounts as aforesaid, said com- 
mittee to be accountable for the expenditure of the money they 
shaU so receive. 

* Resolves 1780, Chap. 20, October. 

2 E.g. Chap. 29, Jan. sess. See Chaps. 72, 85, 206, etc., grants to individuals 
for public purposes. 



i6 BUDGET IN MASSACHUSETTS 

"And it is further Resolved, That the Committee on the part 
of the House shall keep a particular record, expressing the 
names of the persons whose accounts they shall allow, the 
towns to which they belong, for services done, and the sums 
allowed to them respectively, which record shall be laid before 
this House once in every session, for their inspection. 

"And it is also Resolved, That the committee on the part 
of the Senate shall from time to time lay their accounts, which 
they shall have paid, together with the vouchers, and an ac- 
count of their expenditures, before this House, that said com- 
mittee of the Senate may be discharged from such sums of 
money as may appear to have been by them expended, pro- 
vided always that nothing in the foregoing method of examin- 
ing, allowing and paying accounts shall be considered as a 
precedent for the future, but to have been adopted merely 
from the necessity of the present times." 

A few days later certain former duties of the treasury 
were transferred to this committee on accounts by chapter 
37 of the resolves. "Whereas," read the preamble of 
this resolve, "it has been found inconvenient that the 
bounties, . . . should continue to be paid by warant 
on the treasury : Therefore, to prevent unnecessary loss 
of time in getting said bounties, It is Resolved" that the 
committee on accounts be instructed to pay bounties. 

On receiving its appropriation, the house committee 
set about certifying the various claims that came before 
it as payable under the orders and resolves of the general 
court, and the senate committee, on receiving this certifi- 
cate, paid out the amount indicated from the appropria- 
tion granted. From time to time the committee laid its 
"Roll of Accounts" before the general court to have it 
"allowed." At such times the committee was "dis- 



FIRST STEPS UNDER THE CONSTITUTION 17 

charged" of the amounts allowed. For example, on No- 
vember 24th, we find the following resolve : 

"Whereas the committee appointed on the part of the 
Senate to concur and pay accounts, have received of the 
Treasurer of this Commonwealth, by virtue of a warant from 
his Excellency the Governor, dated the fourth instant, two 
thousand pounds in bills of the new emission, and have pro- 
duced good and sufficient vouchers to the satisfaction of the 
Committee for auditing the public accounts, as by the certifi- 
cate of the said committee may appear, for the expenditure 
of one thousand nine hundred and ninety-five pounds thirteen 
shillings and two pence : Therefore, be it 

''Resolved, That the Committee for paying the accounts as 
aforesaid, be discharged of the aforementioned sum . . . leav- 
ing a balance of four pounds six shillings and ten pence, due 
to the Commonwealth, for which said committee is to be ac- 
countable." ^ 

The committee was granted another lump sum of five 
thousand pounds by resolve Chapter 64. In similar 
fashion the committee was later discharged from this 
as well.^ During the session the total advances to the 
committee were £30,000. This committee clearly formed 
one of the important links in the financial administration 
of the earliest days. 

Development of ^^ Rolls. " 

In 1785 Governor James Bowdoin vetoed the customary 
annual resolve creating the committee to receive and 
pay accounts described above. He held that the practice 
was unconstitutional and a usurpation of executive power. 
He said : "The legislature is to raise money in the several 

1 Resolves 1780, Chap. 77, October. ^Ibid., Chap. 180. 

c 



1 8 BUDGET IN MASSACHUSETTS 

ways mentioned; and the executive is to dispose of it 
for the pubhc service according to such acts as are or shall 
be in force." ^ 

As a result, the actual administration of appropriations 
was in danger of passing from the legislature to the execu- 
tive. The last lump-sum grant to a committee was 
voted in 1785.^ The legislature, however, was quick 
to see that this power could be retained by examining 
the specific claims first and then appropriating the needed 
sums specifically. To accomplish this the committee 
on accounts was recreated without the objectionable 
powers, and proceeded to prepare, at least once a session, 
"Rolls'' of all amounts which, in their judgment, were 
due municipalities or individuals and for which no appro- 
priation had been made. Each "Roll" was then laid 
before the legislature and "His Excellency the Governor" 
was "requested to issue his warrant for the payment 
of the corporations and persons borne on this Roll." 
The first such roll was passed November 17, 1786,^ and 
the tactful address to the governor was discontinued with 
roll No. 37 passed June 22, 1797.^ Beginning with roll 
No. 38, it was resolved "that there be allowed and paid 
out of the public treasury" the amounts indicated.^ 

The function of these "Rolls" is indicated by the sub- 
jects customarily contained in them. In 1804, for ex- 

1 Veto message of July i, 1785, Acts and Res. 1784, page 723. 

2 Acts and Res. 1785, Feb. Chap. 125. 
^Ihid., 1786, Nov, Chap, 128, Resolves. 
^Ibid., 1797, May, Chap. 42, Resolves. 
^ Ibid., Jan, Chap, 135, Resolves. 



FIRST STEPS UNDER THE CONSTITUTION 19 

ample, there were two "Rolls" of $16,378.48 and $30,- 
496.48, respectively, one passed the last day of the May 
session, and the other the last day of the January session.^ 
Each of these classifies the accounts under six heads: 
Paupers, militia, convicts, sheriffs, printers, and miscel- 
laneous. Under this last head appear such items as 
repair of the state house, stationery, surveying, record 
books, messenger service, postage, and auditing accounts.^ 
That these "Rolls" were used as a means of meeting 
deficiencies also is indicated by resolves of 1791 and 1792. 
In 1 791, twenty -four pounds were appropriated to Jacob 
Kuhn, chief messenger of the general court,^ to purchase 
**fuil and candles" for the court. ^ In 1792, in "Roll 
No. 24, " appears the item : ^ 

"To Jacob Kuhn for the Money expended by him for the 
purchase of Wood Coal &c. for the use of the General Court 
over and above the sum of twenty four pounds paid him by 
the Treasurer persuant to a Resolve passed June 18th, 1791 

. . . £2/8/5i. 

The passage of "Rolls" was continued throughout 
this entire period, the last appearing in 1848.® During 
the latter years the "Rolls" were split up, such sections 
as the pauper or militia accounts appearing separately.'^ 
This system made it possible for the legislature, and more 

^ Acts and Res. 1804, Resolves, May, Chap. 58; Jan. Chap. 153^ 

2 Ibid., page 396. 

3 Jacob Kuhn discharged the administrative functions of the sergeant-at- 
arms, an office which was not created till 1835. 

* Acts and Res. 1791, May, Chap. 79, Resolves. ^ 

^Ihid. 1792, May, Chap. 82, Resolves. ^ Ihid. 1848, Chap. 70, Resolves. 

7 E.g. Ibid., 1839, Chap. 38, Resolves; 1842, Chap. 92, Resolves. 



20 BUDGET IN MASSACHUSETTS 

especially for the house, to keep its hand on the adminis* 
tration of an important part of the commonwealth's 
finances, notwithstanding the abolition by the governor's 
veto of the committee to receive and pay accounts. 

Estimates. 

During the period 1 780-1849 the general court custom- 
arily had the benefit of estimates, both of revenues and 
expenditures, in making its appropriations.^ These esti- 
mates were prepared by the treasurer, who was at this 
time elected on joint ballot of the two chambers,^ and 
were submitted to the house with recommendations by 
the committee on finance.^ Occasionally the treasurer 
was given broad powers to gather material on which to 
base his estimates, but no effort appears to have been 
made to get the ideas of the heads of the various depart- 
ments.^ In form, the estimates first appear in brief 
tables with considerable text, though at times there are 
no tables.^ The preparation of estimates was not a regu- 
lar duty of the treasurer, but was required from 3^ear to 
year by special order of the house. In 1827 the order 
was passed on June 19th ; ^ in 1837 on January 9th,^ and in 
1839 on January i6th. On this last occasion the treasurer 
complains that he has had but two days to draw up the 

1 For certain years it is impossible to find any evidence of estimates. This 
is especially surprising from 1844-1847. 

2 Const. Part II, Chap. II, sec. IV, Art. i ; Amend. Art. XVII. 

^ E.g. Report of Committee on Finance for 1822, 1827, 1828, 1832, 1833, 
1834, 1836, 1838, 1841, 1843, etc. 

^ E.g. Order of House, June 19, 1826. ^ E.g. 1834, 

" House Documents 1827. ''Ibid., 1837. 



FIRST STEPS UNDER THE CONSTITUTION 21 

estimates.^ In 1843 the treasurer was given from Janu- 
ary 28th, Saturday, to February 3d, Friday, to prepare 
the estimates.^ Throughout this entire period the finan- 
cial data presented in the estimates rarely exceeded two 
pages in length.^ 

After four years during which no estimates appear to 
have been made, either by the treasurer, or by the com- 
mittee on finance, the treasurer in his report for 1848 
almost apologizes for furnishing on his own initiative an 
estimate of revenues and expenditures for the coming 
year. He says that he trusts there may be "no impro- 
priety in putting the legislature in immediate possession 
of all the facts that can now be obtained," though it has 
not been the custom for some years.^ The estimate 
shows a balance of $18,000 — which may have had some 
influence in leading the treasurer to take so rash a step, 
though it must be pointed out that the preceding years 
had also shown surpluses.^ 

Appropriations. 

During the entire period appropriations were made 
both by acts and resolves, by far the greater number 
being contained in resolves.^ These were scattered along 

1 House Documents 1839. ^ Ibid., 1843. ^ E.g. 1837, 1838, 1839. 

* House Documents 1848, No. 4, page 5 ; Joseph Barrett elected in 1844 was 
the Treasurer. 

6 Governor's Inaugurals 1845, 1846 and 1847. 

• Following the provincial custom which was undoubtedly developed to avoid 
the necessity of sending financial votes to England. In 1731 Belcher received 
instructions from England that the resolves must give way to acts in jBnancial 
matters. Court Records, Vol. XV, pages 158-160. 



22 BUDGET IN MASSACHUSETTS 

through the sessions, a marked tendency being to crowd 
them through on the last day of the session. Throughout 
the period lump sum appropriations were the rule, except 
for the "Rolls" described above. There were many 
statutory authorizations, especially of salaries, which 
operated like continuing appropriations.^ 

An effort was made to safeguard money bills by requir- 
ing in the house rules that "no grant of moneys shall 
be made to any of the civil officers of the government 
or officers of Harvard College, without a time being as- 
signed therefor" ; ^ "No resolution shall pass for a grant 
of money without being read on two several days";^ 
and "No bill shall pass to be engrossed and no grant of 
money shall be made on Saturday or Monday." ^ An 
effort was also made to secure an earlier presentation of 
financial petitions by a resolve of 1816, which read: 

^' Resolved f that no application or motion for any grant of 
money, at the next session of the General Court, be received 
after the third Wednesday thereof." ^ 

In spite of these efforts, however, the appropriations 
were as chaotic at the end of the period as at the begin- 
ning.^ In fact, a further element of confusion was intro- 

^E.g. 1848, Chap. 82 Acts; Chap. 301 Res.; Chap. 14 Res.; Chap. 58 Res.; 
Chap. 65 Res. ; Chap. 74 Res. 

2 House Rule No. I, 1808, amended 1812 by requiring one day's notice, and 
repealed in 1821. 

3 Ibid. II, 1808 ; later extended to all Resolves; 1839 amended to read "on 
three several days." 

^Ibid.f III, 1808; dropped in 1809, ^ 

^ Acts and Resolves, 1816, Chap. 49, Resolves. 
^ In 1848 there were 48 Resolves and 2 Rolls. 



FIRST STEPS UNDER THE CONSTITUTION 23 

duced by the increasing practice of passing continuing 
appropriations. 

Position of Legislative Committees, 

The importance of the committees of the general court 
in the budgetary process remained unchanged. The 
ingrained fear of the executive and the natural desire 
of any group of men to hold on to effective power resisted 
any marked lessening of the influence of the legislature 
in financial matters. The bicameral system and the in- 
crease in the business and in the membership of the gen- 
eral court made the committee system indispensable.^ 

In addition to the committee on accounts described 
above,^ the house maintained a standing committee on 
finance and a standing committee on the payroll. Neither 
of these were joint committees,^ as was the committee 
on accounts.^ The senate had no committee on finance 
tiU 1848.5 

The leadership of the committee on accoimts seems to 
have been unquestioned. Its rolls were accepted without 
amendment, though occasionally criticized by governors.® 
The committee on finance appears not to have fared quite 
so well. For example, in 1822 it recommended a state 

^ Membership over 700 in 1812 (Con. Con. Manual, 1917, page 26). 

2 See page 14. ^ Rules of the House, in Manuals, 1808 to 1848. 

^ Joint Rules, in Manuals, 1808 to 1848. 

5 Senate Rules, 1847 and 1848. 

* E.g. Acts of 1845, page 674, Governor George N. Briggs : "The records of 
the Legislature show a great inequality between the sums drawn from the 
treasury by the different towns and counties in the State for the support of 
paupers, compared with their population and the number of paupers returned." 



24 BUDGET IN MASSACHUSETTS 

tax of $100,000 which was rejected by the house.-^ In 
1829 it recommended a tax of $75,000, which was enacted 
in Chapter 27 of the acts of 1829.^ In 1832 it recom- 
mended a state tax which failed, and the appointment 
of a committee on retrenchment which carried.^ In 
1833 it advised the diversion of the proceeds from the 
sale of Maine lands to current expenses which was adopted 
by Chapter 40.^ In 1842 in spite of an exceedingly hot 
minority report, the lead of the majority was followed 
and no state tax was enacted.^ 

Position of the Governor. 

The governor's influence seems to have increased slightly 
during the latter part of the period.^ Almost every in- 
augural address of every governor deals with the subject 
of finance, after the custom handed down from provin- 
cial days. However, the advice given was seldom specific 
or based on detailed knowledge and was more often than 
not disregarded by the legislature. In fact, it is safe to 
say that the power of the governor depended on his per- 
sonal qualities rather than upon his office. 

^ House Documents 1822 ; Acts of 1822. 

^ Ibid., 1829. ^ Ibid., 1832; House Journal 1832. 

* Ibid., 1833, Acts of 1833. ^ Ibid., 1842, Acts of 1842. 

^ Governor Marcus Morton was peculiarly successful in his retrenchment 
reform. See his inaugural of 1843. 



CHAPTER III 

LAYING THE BUDGET FOUNDATIONS 
1849 TO 1 910 

Creation of Auditor. 

In 1849 the legislature created an auditor to be elected 
annually by the two branches by joint ballot.^ He was 
required "to examine all accounts and demands against 
the Commonwealth/' except for debt charges and pay- 
rolls of the council, senate and house of representatives, 
and to "certify the amount due on any such demand, 
the head of expenditure to which the same is to be charged, 
and the law authorizing the payment thereof, to the 
governor, who may draw a warrant, as provided by the 
Constitution." It was also provided that "No warrant 
shall be drawn for the payment of any account or demand, 
except the said payrolls, which has not been certified as 
above." ^ 

The auditor was also required to countersign all receipts, 
to keep account of receipts and expenditures "under 
appropriate heads, " ^ to make an annual audit of the 
treasurer's books and vouchers,- and finally to prepare 
and submit to the legislature annually at the beginning 
of the session a " complete statement of the public prop- 

^ Acts and Resolves 1849, Ch. 56, sec. i. 

^ Idem, sec. 2. ^ Idem, sec. 3. ^ Idem, sec, 4. 

25 



26 BUDGET IN MASSACHUSETTS 

erty of the Commonwealth, its debts and obHgations of 
every kind, its revenue and expenses during the preceding 
year, and the balance left in the treasury at the close of 
such year" and "an estimate of expenses for the current 
year, distinguishing those which are ordinary and current 
from those which are extraordinary, together with an 
estimate of the ordinary income of the Commonwealth, 
and of all other means which he may be able to point out 
for the defraying of expenditures, and shall annex, to 
said statements or estimates, such representations or 
suggestions as he may deem necessary." ^ 

That the general court really meant to turn over to 
the auditor the great bulk of the work with which the 
committee on accounts was engaged is evidenced by 
various resolves of 1850, which refer to the auditor per- 
sonal accounts submitted to the legislature in accordance 
with the custom of seventy years. In 1849 it was also 
provided that pauper accounts should be submitted to 
the secretary, and by him turned over to the auditor for 
allowance,^ and from this time on there were no more 
"Rolls." 3 

Attention must be called to the new departure made 
in requiring the preparation of estimates by the auditor 
and their submission to the general court at the beginning 
of each session. This is the beginning of a staff agency 
to gather and sift estimates for the legislature. At this 
time there was, of course, no sifting. 

* Acts and Resolves 1849, Ch. 56, sec. 4. ' Idem, Ch. 151. 

^ Acts and Resolves 1848, Ch. 70, Resolves, was the last. 



LAYING THE BUDGET FOUNDATIONS 27 

It is interesting, in the light of present day discussion/ 
to see that the auditor was considered from the very 
first a part of the executive department in spite of his 
election by the legislature. It is specifically provided 
that he "shall at all times comply with any regulations, 
in relation to the duties of his office, not repugnant to this 
act, which may be transmitted to him in writing by the 
governor and council," ^ and that his books are to be ex- 
amined and his office to be selected by the governor and 
council.^ In the Hst of office holders published in 1849 
and subsequently, the auditor is classed with the governor, 
lieutenant governor, council, secretary, and treasurer. 
The sergeant-at-arms, however, is classed with the legis- 
lature.^ 

In 1855 an amendment to the constitution made the 
auditor an elective official.^ This amendment was put 
forward by the legislature itself and was not in any sense 
the result of a popular effort to separate the auditing 
fimction from the legislature. It was merely an inci- 
dental result of the wave of democratic control which 
swept the country.^ There is no clearer evidence of this 
than in the constitutional convention of 1853, where an 
amendment to the constitution was drawn providing for 
the popular election of the secretary, treasurer, auditor 



^ F. A. Cleveland in Bureau of Municipal Research Bulletin 61. 

2 Acts and Resolves 1849, Ch. 56, Acts, sec. 7. 

3 Idem, sec. 5, 6. ^ Idem, pages 267, 281. 
5 Constitutional Amendment, Art. XXVII, ratified May, 1855. 

^Cf. Manual of Const. Conv. 191 7, page 64, and Report of Joint Special 
Committee of 1852. 



28 BUDGET IN MASSACHUSETTS 

and attorney-general.^ Neither in the debates of the 
convention nor of the committee of the whole was the 
auditor mentioned in discussing this amendment; in 
fact it was customarily referred to as the amendment 
dealing with the popular election of the '^ Secretary, 
Treasurer, &c.'' ^ 

Preparation of Estimates. 

The first estimates prepared by the auditor covered 
six pages.^ Of these, four are devoted to revenues and 
expenditures. The size and content of the estimates 
remained about the same for the next six years. In 1856, 
however, the auditor's duties were substantially enlarged 
by a resolution providing : 

*'That all expenditures by the heads of departments, boards 
or commissioners, and all other persons acting under the 
authority of the Commonwealth, shall be embraced in the 
annual estimates of the auditor, and be provided for by annual 
appropriations.* 

As a result, the estimates of 1857 increased to twenty- 
three pages, twenty pages of which were explanatory 
material.^ In the following year the auditor improved 
the document by placing the information in tabular 
form and especially by adding the comparative figures 
of the past two years. This reduced the document to 

^Defeated by the people, as were all other suggested amendments. 

2 Journal 1853 Const. Convention, p. 419, 450; Journal of Committee of 
the Whole, p. 452. 

3 Auditor's Rept., 1850 House Docs. 

* Acts and Resolves 1856, Ch. 74, Resolves. ^ House Docs. 1857, No. 9. 



LAYING THE BUDGET FOUNDATIONS 29 

but three pages, explanatory material being placed in 
footnotes.^ 

In 1858 a very important overhauling of the state finan- 
cial system took place, affecting both estimates and appro- 
priations.^ An act was passed reheving the auditor of 
the duty of preparing estimates of expenditures and re- 
quiring, 

"Every public officer or board having charge of any depart- 
ment of the public service requiring an expenditure of money 
from the state treasury, other than the payment of salaries, 
to submit in writing, to the speaker of the house of representa- 
tives, on or before the fifteenth day of January, a detailed esti- 
mate of the sums, which in the judgment of such officer or 
board will be necessary for the maintenance of the departments 
severally under their charge, for the current year.^ 

As a result of this transfer of duty, the auditor's esti- 
mates during the next years relate only to revenues.^ 
Beginning in 1862, the auditor again presents brief esti- 
mates of expenditures ; ^ until 1870, however, the depart- 
mental estimates sent to the speaker remained unpub- 
lished. In this year they appear as a pamphlet consisting 
of twenty-four separate letters.^ In this same year the 
auditor presents his estimate including salaries for the 
first time."^ In 1872 the departmental estimates appear 
not to have been published. 

1 House Docs. 1858, No. 5. 

2 For discussion of appropriations see page ss- 
^ Acts and Res. 1858, Ch. 158, Acts, sec. i. 

* E.g. 1861 House Doc. 50. ^ J862 House Doc. 5. 

« 1870 and 187 1 House Doc. 6. ' 1870 House Doc. 99. 



30 BUDGET IN MASSACHUSETTS 

This unsatisfactory system was given up in 1872, and 
the secretary of state was ordered to receive the estimates, 
which were now to be submitted a month earher, and to 
present them "in one document'' to the legislature when 
it convened.^ 

From this time on the departmental estimates were 
printed each year as House Document No. i. The first 
.year, 1873, it contained twenty separate letters and cov- 
ered twenty-one pages. A few salaries were included. 
The auditor continued to make his estimates in what 
was now regularly House Document 6. These fail to 
agree with House Document i, as for example in 1873, 
where the auditor estimates $11,500 and the department 
$11,750 for the harbor commission.^ The auditor how- 
ever appears to have based his estimates roughly on the 
departmental requests. 

In 1 88 1, in conformity with Chapter 160 of the Laws 
of 1880, the estimates appeared in tabular form together 
with the citation of the authorizing statute and the appro- 
priation of the previous year.^ By Chapter 41 of the 
Laws of 1885, the tabulation and presentation of the 
departmental estimates was again entrusted to the 
auditor. Thus, after almost thirty years of experimenta- 
tion, the general court returned to its original procedure 
with the important exception that the estimates were 
now admittedly those of the departments themselves, and 
not those of the auditor.^ 

* Acts and Res. 1872, Ch. 349 Acts. 

2 House Doc. 1873, No. i and No. 6. 

3 Ibid., 1881, No. I. 4 See Acts 1858, Ch. 158, side heading. 



LAYING THE BUDGET FOUNDATIONS 31 

In 1905, on the initiative of Joseph Walker, chairman 
of the house committee on ways and means, the beginning 
of the fiscal year was changed from January i to Decem- 
ber i.^ This change was made in order that the ways 
and means coromittee might have before it in January 
the actual expenditures of the previous year. Until 
this change was made departments frequently covered 
up the fact that they had large unexpended balances 
from the previous appropriation, and based their story 
of needs on this previous appropriation rather than upon 
their expenditures. 

The shifting of the fiscal year in 1905 was thus the 
first step in the effort to secure a more thorough revision 
of departmental estimates in Massachusetts. It is re- 
garded by some as the first accomplishment of the move- 
ment that culminated in the adoption of the budget sys- 
tem in 1 91 8. 

A direct effort was made in 1907 to introduce some 
planning into the handling of departmental estimates. 
During the session of 1907, a minority report from the 
joint committee on ways and means protested against 
the duties imposed upon the committee and pointed out 
the impossibihty of giving adequate consideration to the 
mass of unsifted departmental estimates which came to 
the committee at the opening of each session.^ During 
the summer a recess committee attempted to work out a 
remedy, and in its report to the next general court stated 
that there should be "some board to consider these 

* Acts of 1905, Ch. 211. 2 1907 House Document 1566. 



32 BUDGET IN MASSACHUSETTS 

financial problems in a broad way, giving due considera- 
tion to the conditions of the treasury, the probable tax 
levy and the policy of the commonwealth." The majority 
report recommended the creation of a *^ Board of Fi- 
nance'' to be composed of the Heutenant governor, the 
treasurer, the auditor, and the chairmen of the house 
and senate committees on ways and means. The powers 
and duties of the committee were outlined as follows : 

"The estimates of revenues and expenses should be referred 
to such board for its consideration and report to the legislature. 
. . . The board of finance should have authority to conduct 
of its own volition informal special investigations of expendi- 
tures and of financial methods and management.'' ^ 

The net result of this agitation was small indeed. The 
committee itself was so much divided that it could exer- 
cise no constructive leadership in the legislature, and its 
recommendations were forgotten almost as soon as filed. 
This effort to systematize the estimates never reached the 
stage of serious consideration. 

From 1905 until 19 10 the other significant changes 
in the estimates were the inclusion of salaries ^ and of the 
comparative expenditures of the past three years,^ and 
the separate presentation of capital outlays and such 
extraordinary requests.* In the case of estimates for 
buildings, trustees of institutions were required to present 
preliminary plans and specifications and reliable archi 

^ 1908 House Document 225. Three minority reports were filed as well as 
the majority report. 

2 Acts 1905, Ch. 211, sec. 6. ' Acts 1908, Ch. 597, sec. 5. 

^ House Doc. I, 1905 to 19 10. 



LAYING THE BUDGET FOUNDATIONS 33 

tects' estimates with their request for appropriations.^ 
Institutions also presented a Hmited amount of unit cost 
data beginning in 1902.^ 

By the end of the period the book of departmental 
estimates covered over 100 pages and contained in some 
detail estimates for the chief running expenses of the 
government.^ 

Appropriations. 

During the years 1848 to 1910 there were two separate 
periods during which an attempt was made to systematize 
the appropriation process. The first was in 1858 and the 
second in 1896. 

In 1858 fundamental and revolutionary steps were 
taken. The very first act of the session provided : 

"No money shall be paid from the treasury of the Common- 
wealth at any time hereafter, except upon the warrant of the 
governor, drawn in accordance with some appropriation con- 
tained in some act or resolve duly passed within the same po- 
litical year." * 

Debt charges and the salaries of the governor and the 
judges were specifically exempted,^ and it was provided 
that unexpended balances should lapse. ^ 

This act, at a single sweep, aboHshed all continuing ap- 
propriations and made it necessary for the legislature to 
vote all appropriations yearly.*^ To make sure that this 
revolutionary move would be fully understood, the legis- 

1 Acts 1907, Ch. 520, Acts 1908, Ch. 597. ^ House Doc. I, 1902 ff. 

^ Ibid., 1909. ^ Acts of 1858, Ch. i, sec. i. ^ Idem, sec. 2. 

« Idem, sec. 3. • ^ Cf . Acts of 1858, Ch. 96. 



34 BUDGET IN MASSACHUSETTS 

lature added to the maintenance bill of the year the pro- 
vision that the appropriations of the bill were to be con- 
strued as repealing any previous acts or resolves making 
a larger grant/ and that : 

" All acts and parts of acts, all provisions of law whatsoever, 
resolves and parts of resolves, customs, traditions, usages and 
prescriptions, which are inconsistent with the provisions of 
this act (excepting only such as may be contained in the Con- 
stitution of the United States, the Constitution of the Common- 
wealth of Massachusetts and the first Chapter of the acts of the 
present year) are hereby repealed, abrogated, and annulled/' ^ 

In harmony with this drastic reform a single mainte- 
nance bill for 1858 was drawn and passed within a month 
of the convening of the legislature.^ 

This was supplemented by six appropriation measures. 
These provided : 

1. An emergency fund for the governor and council 
of $io,coo.^ 

2 . An appropriation of the income from the school f und.^ 

3. Appropriations to meet past deficiencies, fourteen 
items.^ 

4. A reappropriation of $58,000 of unexpended bal- 
ances.^ 

5. Appropriations to cover the expenditures authorized 
by resolves during the session.^ 

6. Supplementary appropriations for 1858.^ 

* Acts 1858, Ch. II, sec. 6. ^ Idem, sec. 9. ^ Idem, Ch. 11. 

* Laws of 1858, Ch. 22. None of this appropriation was used. Acts 1859, 
p. 484. ^ Idem, Ch. 96. ^ Idem, Ch. 131. 

7 Idem, Ch. 140. ^ Idem, Ch. 148. ^ Idem, Ch. 173. 



LAYING THE BUDGET FOUNDATIONS 35 

It is to be noted that the last three bills were passed on 
May 27th, the last day of the session. 

This heroic and apparently successful effort to unify 
the appropriation process persisted with fair success till 
1863, though in 1859 nineteen separate bills were passed, 
fourteen of them for current maintenance.^ Beginning 
in 1863, however, a custom developed of separating the 
maintenance bill into three or more bills providing sepa- 
rately for the salaries of the executive departments, the 
salaries of the judiciary, and the expenses for materials, 
supplies, etc., of the government. This division was 
never clean-cut, however, either inclusively or exclusively, 
and every attempt to group appropriations seems to have 
broken down.^ 

Appropriation by individual resolves, which had been 
discontinued in 1858,^ became more and more common 
in the course of time, adding still further to the confusion. 
This practice was permanently discontinued, beginning 
with 1880. In 1879 eight appropriations were made by 
resolve alone. ^ 

In 1872 an attempt was made to introduce some order 
into the chaos by requiring the ways and means committee 
to draft a single maintenance bill based on the depart- 
mental estimates.^ The only result appears to have been 
Chapter 349, requiring the secretary to gather and pub- 
lish the estimates. At any rate, the number of bills in- 

^Laws 1859. 

2 Laws 1863, Ch. I, 22, 31, 34,fetc. ; 1879, Ch. 5, 6, 7, 13, 29, 36, 77, etc. 

3 Laws 1858, Ch. 148. ■* Res. 1879, Ch. 9, 14, 20, 27, 36, 44, 46 and 50. 
5 House Doc. 1872, No. 335. 



36 BUDGET IN MASSACHUSETTS 

creased to twenty-one in 1884, to thirty-four in 1892, 
and to forty-nine in 1895. 

In 1896 occurred the second effort of the period to 
systematize appropriations. Instead of attempting to 
bring all salaries together in a bill, or all "expenses," 
the system now adopted was that of bringing all appro- 
priations for a given department together in a single bill.^ 
This had the merit of classifying appropriations by spend- 
ing units, but it resulted in the passage of a much larger 
number of bills, thus tending to increase the confusion. 
In 1896 there were ninety-nine appropriation bills, and 
in spite of the efforts at rigid classification, many related 
items are to be found in separate bills.^ 

Between 1896 and 19 10 this attempted systematiza- 
tion gradually disintegrated, though at no time was it 
definitely given up. 

The Authorization of Transfers, 

By Chapter 549 of the Acts of 1908 the governor was 
authorized, with the approval of the council, to use the 
lump sum appropriation of the executive department as 
a fund from which to make transfers to supplement inad- 
equate appropriations whenever the auditor certified 
to the necessity of the transfer. This act introduced 
into the law the first provision in Massachusetts for 
transfers between appropriations. At the time of the 
passage of this act, the emergency appropriation was 
increased to $100,000 annually. 

^E.g. Laws 1896, Ch. i, 3, 4, 5, etc. ^ Ibid., Ch. 25, 104, 122. 



LAYING THE BUDGET FOUNDATIONS 37 

Growing Importance of Committees. 

The importance of legislative committees in the budget- 
ary process grew steadily between 1849 and 1910. The 
leadership of the committee on finance was confirmed by 
the house rule, introduced first in 1858, providing that 
**A11 bills and resolves involving an expenditure of public 
money, shall, after their first reading, be referred in course 
to the Committee on Finance, for report on their relation 
to the finances of the Commonwealth.'' ^ This provision, 
readopted from year to year, has by long usage become 
part of the structure of government in Massachusetts. 

During the early part of this period, the legislature 
and its committees alone received the departmental esti- 
mates.^ In 1859 Governor Nathaniel P. Banks com- 
plains : ^ 

"The legislature by statute of 1858, Chapter 158, has de- 
prived the executive department of the power to make an 
exact statement of the wants of the government for the present 
year." 

By 1879 the committees are classed with the governor 
and the legislature when it comes to power over appro- 
priations. In speaking of retrenchment Governor Talbot 
says : * 

"In all matters requiring change, the final decision rests 
with the Legislature. The labor of investigation falls upon its 
committees. But the duty of recommendation is vested in 
the Executive." 

1 House Rules, Ch. V, 59. 

2 During the years when estunates were delivered to the speaker. 
^Inaugural address, January 7,^1859, p. 492, Acts of 1859. 

* Acts 1879, p. 691. 



38 BUDGET IN MASSACHUSETTS 

He refers also in subsequent remarks to "the lengthened 
hearings before the committees." ^ 

The final position of the ways and means committee, 
which was substituted for the finance committee in 1896,^ 
is a matter of current knowledge. By 19 10 it is safe to 
say that this committee had more power over the normal 
course of appropriations than any other agency, the 
legislature and the governor included. It became the 
accepted agency for determining the financial policy so 
far as appropriations and the state tax were concerned. 
Its leadership prevailed except in occasional and extraor- 
dinary instances. 

The Increased Leadership of the Governor, 

Inconsistent as it may seem with the increased power 
of the committee on ways and means, the development 
of the influence of the governor in financial affairs during 
the period ending in 19 10 is equally marked. The bud- 
getary revolution of 1858 was due in part to the efforts 
of Governor Banks.^ Governor Talbot led the move- 
ment of 1879 which resulted in many salary reduc- 
tions,^ and Governor Draper held a firm hand on the 
financial affairs of the commonwealth during his three 
terms. It was due partly to his influence and to 
the confidence he inspired that a new departure 
was made possible in the financial procedure of the 
commonwealth in 19 10. 

1 Acts 1879, P- 692. ^ House Rules 20. 

3 Acts 1858, p. 173 flf. * Acts 1879, P- 690 ff., and index under salaries. 



LAYING THE BUDGET FOUNDATIONS 39 

Development of Financial Control. 

In 1849 the legislature turned over to the auditor the 
responsibility for scrutinizing all payments to insure their 
regularity. From this time on the committee on accounts 
had less and less to do, until it was finally abolished in 
1869.^ During the same period, however, the machinery 
of control was extensively developed. In 1858 it was 
specifically enacted that ^^no public functionary shall 
make any purchases or incur any liabilities in the name 
of the Commonwealth, for a larger amount than that 
which has been appropriated by law for the service or 
object; and it is hereby enacted and declared that the 
Commonwealth has no responsibility for the acts of its 
servants or officers, beyond the several amounts duly 
appropriated by law." ^ This provision together with the 
powers conferred upon the auditor ^ brought about a 
very real control of expenditures. 

In order that the legislature and the public might have 
information concerning financial transactions, various 
provisions were enacted requiring financial reports. In 
1859 annual financial reports were required of all officers 
or boards.^ The auditor's report presented not only 
information with regard to revenues and expenditures, 
but also with regard to debts, funds, investments and 
balances. He was directed to include everything "that 
may be useful or interesting to the people of the Common- 

* House Rules 1868, 1869. 

2 Acts 1858, Ch. II, sec. 7; Ch. 159, sec. 13, 14. 

3 See p. 26. *Laws 1859, Ch. 221. 



40 BUDGET IN MASSACHUSETTS 

wealth." ^ It was required that the various heads of 
expenditure be separated and classified by spending units 
and finally that ^^no expenditure exceeding five hundred 
dollars, shall be included under any indefinite head." ^ 
These requirements were amended occasionally as in 1867, 
1884, 1905, and 1908,^ but stood in 1910 substantially 
as in 1858 and 1859. 

A gradual improvement in the auditor's accounts be- 
gan almost as soon as Henry E. Turner took over the office. 
In 1902 the institutional accounts as presented by the 
auditor were systematized, and what previously appeared 
as ^^miscellaneous expenses" were now classified as food, 
clothing and material, furnishings, heat, light and power, 
repairs and improvements, farm, stable and grounds, and 
miscellaneous. With this change it became possible for 
the first time to present a slight amount of unit cost data.^ 

In 1908 the auditor was authorized to appoint a " Super- 
visor of Accounts" with power to ^^ direct and control 
all the accounts in all the departments" with full authority 
to "prescribe, regulate and make changes in the methods 
of keeping and rendering accounts." It was further 
provided that "He shall establish in each department a 
proper system of accounts, which shall be uniform as far 
as practicable. He shall establish a proper system of 
accounting for stores, supplies and materials, and may 
provide, where he deems it necessary, for a continuing 
inventory thereof. He may inquire into the methods 

1 Laws 1858, Ch. 158, sec. 5. 

2 Laws 1867, Ch. 178; 1884, Ch. 207; 1905, Ch. 211; 1908, Ch. 630. 
' Auditor's Report, 1902 fif. 



LAYING THE BUDGET FOUNDATIONS 41 

of purchasing and handling such stores, supphes and 
materials by the departments, reporting to the auditor 
such changes as may in his judgment be deemed wise. 
He shall provide such safeguards and systems of checking 
as will insure, so far as possible, collection of all the revenue 
of the Commonwealth.'' ^ 

With these powers, the auditor began a fundamental 
reform of institutional accounting which was much needed. 
Until 1908, for example, no state institution was audited 
with the exception of the Danvers State Hospital. ^ The 
process, however, was a slow one. In 191 1 Governor 
Foss said : 

"In 1908 the legislature directed the state auditor to 
inaugurate a system of accounts for each of these several state 
institutions; but the investigators report that to date, no 
comprehensive system has been put into effect and that the 
lack of it is a great detriment to the state and the insti- 
tutions."^ 

Without the advances that were actually made, how- 
ever, the subsequent steps towards a budget would have 
proved almost impossible. 

^ Laws 1908, Ch. 597. This act was drafted by Mr. Turner. 
2 Statement of Supervisor of Accounts, 19 17. 
^ Acts of 1911, p. 1259. 



CHAPTER IV 
THE GOVERNOR AND THE BUDGET 

191O TO 1918 

During the years 1910 to 1918 events moved rapidly 
in the financial history of the state. There were two 
conscious efforts to establish a budget system and to make 
the governor responsible for drawing up the financial 
plans of the commonwealth. 

I. Budget Reform in 19 10 and Its Results 
The Walker Act. 

In 1 910, Speaker Walker, backed up by Governor 
Draper and a safely Republican legislature, secured the 
enactment of a law which, for the first time in the history 
of the state, drew the governor into the budgetary process. 
It was a revolutionary step. This act was entitled 
"An Act to Provide for Supervision by the Governor and 
Council of Expenditures and Other Financial Operations 
of the Commonwealth." ^ The act provided that : 

1. Departmental estimates for current expenses shall 
be separated from estimates for capital outlays, etc., 
each to be pubhshed in separate documents. 

2. Estimates shall be submitted to the auditor by 
November 15th and by him to the governor and council 
the first week in January. 

^ Laws of 1 9 10, Chapter 220. 
42 



THE GOVERNOR AND THE BUDGET 43 

3. "The governor shall transmit the same {i.e. depart- 
mental estimates and estimated revenue) to the general 
court with such recommendations, if any, as he may- 
deem proper.'' 

4. In the case of special appropriations and capital 
outlays, the governor "shall make recommendations as 
to how much should be raised by the issue of bonds and 
how much should be paid out of current revenue." 

5. Plans, estimates, and specifications of new buildings 
requested shall be submitted to the governor and council. 

6. The auditor shall act as the staff agent of the gov- 
ernor and council in gathering "information with regard 
to revenues, expenditures and other financial operations." 

7. The governor may split up the estimates and trans- 
mit them severally to the legislature or withhold items 
for further investigation at his discretion. 

This act has the distinction of being the first law passed 
by any state definitely turning over to the governor the 
responsibility and the opportunity of drawing a budget.^ 

Governor's New Responsibility Recognized in Republican 
Platform. 

The Republican platform of 19 10 shows beyond any 
doubt that the leaders of the party recognized the full 
import of the new fiscal legislation. The platform reads, 
in part : 

^ The Ohio budget system, often listed as the first, was established by Senate 
Bill No. 227 of May 10, 1913, Laws, 1913, p. 659. See also Bulletin 91 of the 
Bureau of Municipal Research. 



44 BUDGET IN MASSACHUSETTS 

"We approve the series of acts of the legislature, passed 
within a few years, to improve the administration of the 
finances of the commonwealth, the method of making appro- 
priations, of accounting, and especially the act of the last 
legislature, which placed upon the governor direct responsibil- 
ity for all estimates for appropriations, and so gave to him 
more effective control over the expenditures of the common- 
wealth.'' 1 

The Democratic platform was entirely silent on the new 
budget legislation. 

Democratic Governor Elected, 

In the November elections the Republicans suffered 
an unexpected and serious defeat. Eugene N. Foss, 
Democrat, was elected governor by 35,000 votes. The 
council and the senate remained Republican, however, 
and after a bitter fight the Republicans elected Joseph 
Walker speaker and organized the house.^ The governor 
himself minced no words in describing the situation as 
follows in his inaugural address: 

"The plurality of over 35,000 which I received on clearcut 
issues indicated unmistakably and overwhelmingly the will 
of the people. 

"Moreover, in the total popular vote for the lower house of 
our legislature a plurality of over 38,000 was registered against 
the return of our senior senator to the United States Senate.^ 
Yet, owing to our gerrymandered districts we have today a 
small Republican majority ; and we are confronted with the 
possibility of returning to the senate of the United States a 
man whose retirement the people thus clearly demand." ^ 

1 Boston Transcript, October 6, 1910, p. 3. 

2 Senate and House Journals, 191 1 ; Laws igii, p. 1301, 1302, 1304. 

3 Henry C. Lodge. * Laws of 19 11, p. 11 29, 



THE GOVERNOR AND THE BUDGET 45 

As we shall see later, this difference of political allegiance 
of the governor and the general court and the council 
had a profound effect on the subsequent evolution of the 
budget. 

Governor Foss and the Walker Act, 

Eugene N. Foss became Governor and was sworn into 
oj65ce on January 5, 191 1. He commenced immediately 
to go over departmental estimates in order to submit 
his financial recommendations to the legislature in ac- 
cordance with the Walker act. On January 11 he sub- 
mitted his recommendation for the salaries and expenses 
of the executive and legislative departments, amounting 
to $496,800. These were passed without change by 
the legislature.^ He followed this on January 20 with 
recommendations for the departments of the secretary, 
the treasurer, the auditor, the attorney-general, the 
sergeant-at-arms, the ballot law commissioner, the civil 
service commission, the state board of conciliation and 
arbitration, the controller of county accounts, the board 
of registration in dentistry, the district police, and the 
salaries of the entire judicial department, all together 
amounting to $1,174,958.32. The legislature proceeded 
to draw and pass separate bills for each of these depart- 
ments as had been the custom since 1896. In almost 
every case the governor's recommendation was followed, 
though $6,800 was added to the appropriation for "in- 
cidentals" for the sergeant-at-arms,^ while $200 was cut 

^ Chapters i and 2. * Acts of 191 1, Chap. 117. 



46 BUDGET IN MASSACHUSETTS 

from the "expenses" allowed the board of registration 
in dentistry ^ and $500 was cut from the governor's 
allowance to the district police for the maintenance of a 
patrol tug.2 

In going over these estimates Governor Foss soon found 
that he needed more assistance and more power. The 
attorney-general, a Republican who ran ahead of all 
other Republicans in the fall elections, ruled that the 
governor had no authority to make investigations of the 
various departments.^ 

While this question was in the air, Speaker Walker 
is reported as saying : 

"My bill for the control of the state finances is doing just 
what I wanted it to do. It has placed the responsibility where 
it belongs — on the governor — and made him realize it. 
He is now responsible to the people. 

"Before the bill was passed last year there was no real re- 
sponsibility anywhere. It is now 'up to' the governor. He 
must exercise control and be responsible for increase in expendi- 
tures and in the debt as well. If our accounting and auditing 
system is wrong it should be made right. The governor 
must investigate. He cannot evade the responsibility. If 
he needs assistance, he must have it. If the council does not 
prove an efl&cient body to investigate and advise (I had hoped 
it would), then experts must be employed to investigate, and 
advise the governor." ^ 

Following this and the opinion of the attorney-general, 
Governor Foss wrote to the legislature concerning the 
Walker act : 

* Acts of 191 1, Chap. 66. ^ Idem, Chap. 112. 
3 Opinion of January 21, 1911, Acts of 1911, p. 1155. 

* Acts of 1911, p. 1154. 



THE GOVERNOR AND THE BUDGET 47 

"In order to pass upon any estimate for any department, 
board or institution, in accord with this statute, the executive 
should have the right to ascertain whether or not the business 
of that department, board or institution is being conducted 
on an efficient basis. 

"However, Chapter 220 does not invest the executive with 
authority to obtain the information which is necessary for 
arriving at a just conclusion ; and there is no law under which 
the executive is empowered to obtain such information, as 
will be seen from the appended letter from the attorney 
general under date of January 21, 191 1, to which your atten- 
tion is respectfully directed. 

" I therefore ask for such authority at once . . ." ^ 

Governor Authorized to Employ Experts. 

On March 2, slightly over a month later, and after 
something of a struggle, the legislature passed Chapter 
82 granting the governor the authority to employ experts 
"to make such investigations of any of the commissions, 
departments or institutions of the Commonwealth as he 
believes is necessary to enable him to carry out the pro- 
visions of Chapter 220 of the acts of 1910.'' It was 
provided that these experts should report in writing and 
that copies of their reports should be filed with the council 
and with the joint committee on ways and means, and that 
they should be paid for from the emergency fund of the 
governor and council. 

The governor immediately set to work with his new 
assistants and, beginning the end of March, reported 
severally and independently upon the appropriations for 
the salaries and maintenance of the various departments 

^ Acts of 191 1, p. 1 155. 



48 BUDGET IN MASSACHUSETTS 

and institutions. The last such message was dated July 
lo, 191 1, two weeks before the close of the session. 

The Walker act provided for the separate consideration 
of estimates for capital outlays, or "specials," as they 
are called.^ With the aid of the experts, the governor 
attempted to sift the $1,753,075 requested for specials 
and to make his recommendations. The first of these 
reports is dated April loth, and the last July loth.^ 

The Governor's Recommendations and Legislative Revision, 

The results of the governor's recommendations are 
interesting. His recommendations for salaries and for 
current maintenance were, of course, largely fixed by 
existing state law and as a result were in the main fol- 
lowed by the legislature. The following are typical 
recommendations in cases where the state law allowed 
him some leeway : 

''The pending appropriation for fisheries and game [Com- 
missioners of Fisheries and Game] is $73,285, or more than 
$1 1,000 above the cost of that department in 1 910. I approve 
only an appropriation equal to last year's costs, and instead 
of spending more money, I recommend placing the department 
in the hands of a single commissioner or manager, with obvious 
economy. 

"The pending appropriation for the State Forester, aside 
from the $150,000 item for moth work [discussed in an earlier 
message] amounts to $30,000. Last year, aside from moth 
work, $27,000 was spent, and I can approve of only that 

1 Acts 1910, Chap. 220. 

2 Acts 191 1, p. 1265. The session lasted 206 days and was prorogued July 
28, 191 1 {Id., p. 1 1 is). 



THE GOVERNOR AND THE BUDGET 49 

amount for the present year with, however, an earnest recom- 
mendation that the legislature consider means of effective 
forest conservation and development, which the province of 
the State Forester does not include." ^ 

In each of these cases the recommendation of the gov- 
ernor was disregarded. An appropriation of $73,285 was 
granted the commission on fisheries and game, and an 
appropriation of $30,000 to the state forester.^ 

But taken all in all, the recommendations of the gov- 
ernor and the actual appropriations for current expenses 
and salaries are in striking accord. The governor's 
recommendations total $12,811,326.49^ and the corre- 
sponding appropriations are $12,818,557.49, or but 
$7,231.00 higher. The total increases were slightly 
more, as there were a few small decreases, as has been 
noted. 

In the field of "specials'' there was a more marked 
difference of opinion. Governor Foss set to work with 
his experts to sift out the requests for land, buildings, 
and other capital outlays. The following are typical 
examples of his messages to the legislature : 

"Foxborough State Hospital requests $100,000 as a special 
appropriation, but the investigators find that this request is 
not planned on an economical basis. For instance, the ' colony 
method' of housing patients is known to be the most economi- 
cal. Yet, at Foxborough, a colony cottage is asked for, which 
will cost over $500 per patient ; an utterly extravagant cost 

^ Special Message of June 8, 191 1, Laws of 191 1, p. 1232. 
2 Laws of 1911, Chap. 672, 729. 

' This does not include a few cases in which the governor's recommendations 
are indefinite. 
E 



so BUDGET IN MASSACHUSETTS 

when compared with the costs of similar buildings at other 
institutions. 

''Added to this request is an item of $17,000 to maintain 
two remodelled farm buildings, with 32 patients for six months 
of the present year, and to furnish certain supplies. Even 
omitting the $2500 automobile and other easily preventable 
expenses, this request represents a cost of $600 per capita per 
year to maintain each of these 32 able-bodied inebriates on a 
farm. 

"I cannot approve this $100,000 special expense for Fox- 
borough. It appears absolutely unreasonable, and even the 
ordinary running expenses of the institution are so high that 
I desire to see the institution entirely reorganized and put 
upon a sound footing. 

''Boston State Hospital wants $166,875. $22,000 of this 
is for a nurses' home to provide for ^^ nurses needed in con- 
nection with the new male infirmary. The per capita cost of 
this building would be $668. At Wrentham an employees' 
building has been built at practically one-half this per capita 
cost. I cannot approve this item. A cheaper style of con- 
struction would prove equally serviceable. 

"A central service building to cost approximately $37,750, 
is wanted with other factors of a 'farm group,' making a total 
of $83,000. 

"Mr. Harpham's detailed discussion of the plans convinces 
me that the whole scheme is an extravagant one. For example, 
although the institution now has two central heating power 
plants, $10,500 is wanted for a third boiler plant for this 'farm 
group.' There is no good reason for putting in a high priced, 
high pressure boiler plant merely to heat these buildings. A low 
pressure heater at a small fraction of the cost would do the work. 

"$42,000 is wanted for a 'service building' for storage and 
refrigeration. Yet by remodelling the practically unused 
basement of the present buildings, the investigators state that 
a large excess of storage space can be provided above the 
present need. 



THE GOVERNOR AND THE BUDGET 51 

"An expensive ice machine, to avoid the present labor of 
cutting ice, is equally unnecessary. Again extensive cold 
storage of food is not desirable in an institution so near the 
Boston markets. I cannot approve any detail of this special 
appropriation of $166,875. 

"Less costly dormitories undoubtedly should be provided 
for and built. For reserve power a single new dynamo might 
be installed, or a contract made with the electric light com- 
pany for power to use in an emergency if needed. The remain- 
ing items are, in my judgment, unwarranted." ^ 

In each of these cases the legislature disregarded the 
governor's recommendation. After some consideration 
the Foxborough State Hospital was granted $144,000 
and the Boston State Hospital $166,875. Governor Foss, 
however, vetoed the grants and no attempt was made to 
pass the resolves over his veto.^ 

The following recommendations from the message 
deaHng with state hospitals are equally representative.^ 
In each case, the action of the legislature is indicated in 
brackets. 

"Monson State Hospital calls for $43,000 for a refrigerating 
plant and machine shop, a dining room and new laundry facili- 
ties. I cannot approve of these as they stand. But I call 
your attention to the investigators' recommendations. They 
suggest making increased facilities by utilizing a basement 
which has been finished but never put in use. . . . [Cut to 
$17,000 and voted, Resolves, Chap. 137.] 

"I cannot approve the Northampton State Hospital's re- 
quest for $46,925 for a bakery and laundry. The investiga- 
tors report that a simple rearrangement of the present quarters 

^ Special Message of June 27, 1911, Laws of 1911, p. 1249. 

2 See Veto Messages of June 19 and July 24. 

'Special Messages of June 27, 1911, Laws of 1911, p. 1251. 



52 BUDGET IN MASSACHUSETTS 

will provide the necessary room and leave only the new ma- 
chinery to be purchased. [Voted in full, Resolves, Chap. 156.] 

''I cannot approve the total of the Worcester State Asylum's 
request for $90,800. Instead of a new nurses' home to cost 
$29,000, the investigators think there is enough unused space 
available for present needs. [Cut to $88,400 and voted. Re- 
solves, Chap. 149.] 

"The proposed new buildings for patients are considered un- 
necessarily costly per capita and the plans should be revised 
and then resubmitted. 

"Similar criticism holds for the elaborate $17,000 storage 
house. Here also a high priced, high pressure boiler is wanted 
for heating only, whereas a cheaper one, as commonly used for 
house heating, should be provided. I believe the $2400 re- 
quested for hydrotherapeutic treatment to be in line with 
modern methods and approve it. [Storage house allowed, 
hydrotherapeutic equipment disallowed. Resolves, Chap. 
149.] 

"Westborough State Hospital requests $28,480 for altering 
buildings, for new lands and for sewage beds. The buildings 
undoubtedly need complete renovation and the appropriation 
as a whole appears sound. It contains no extravagant de- 
mands and is approved. [Cut to $18,900 ; new land and sew- 
age beds disallowed; Resolves, Chapter 128.] 

"The Massachusetts School for the Feeble-Minded requests 
$61 ,688 for new buildings for nurses and patients. The nurses' 
building would cost $873 per person, and the building for 
patients $688 per person. At the Wrentham State School a 
more economical scale of buildings has been followed, and if 
the trustees of the Massachusetts School cannot do as well, 
I recommend that the school be enlarged no further, and all 
necessary additions made at Wrentham. The appropriation 
is not approved. [Extension to nurses' home allowed at 
$15,000; Resolves, Chap. 132.] 

"Gardner State Colony requests $21,400 for new buildings, 
equipment and water supply. The principal new building 



THE GOVERNOR AND THE BUDGET 53 

is to cost less than $300 per capita, and the remaining items 
are moderate. I therefore approve them all." [Allowed; 
Resolves, Chap. 129.] 

Governor Foss vetoed four resolves authorizing appro- 
priations in violation of his previous recommendations. 
None of these were even brought to a vote after the veto. 
In one case a part of a vetoed resolve was subsequently 
repassed and consented to by the governor.^ 

The total "specials" for which exact figures can be 
readily given are : 

Departmental requests $2,170,550 

Governor Foss approved 1,186,732 

Legislature voted 1,970,220 

Vetoed by governor ........ 417,475 

Final appropriation 1,552,745 

In other words, the recommendations of the governor 
were increased 23.5 per cent. In fact, a detailed study 
shows that the actual variation is greater than this, as a 
number of cuts were made in amounts allowed by the 
governor.^ It is to be noted that the resolves authorizing 
these appropriations were signed by the governor with 
the exception of one.^ 

Results of Executive Participation in Appropriation Process, 
The financial record of the session shows that the gov- 
ernor's recommendations for current expenses were, in the 
main, of necessity adopted by the legislature, but that 
his recommendations for "specials" were extensively 

* Veto Messages of June 19, July 20, and 24tli; Resolves 191 1, Chap. 152. 
^ See Resolves, Chaps. 98, 104, 105, 128, 149. 

'Acts 191 1, Chap. 630, allowed to become a law without the signature of 
governor. 



54 BUDGET IN MASSACHUSETTS 

increased and that in approving these increases he fol- 
lowed the lead of the legislature. 

As a result of this experience Governor Foss was con- 
vinced more than ever of the wisdom of the suggestion 
made in his inaugural address that a state board of finance 
should be created to investigate all departments and 
institutions and to go over estimates and make recom- 
mendations to the legislature. In submitting his last 
special message on appropriations two weeks before ad- 
journment, he said : 

"In thus concluding the work of investigating, I call atten- 
tion to the imperative need, in this state, of a central finance 
board. This investigation has revealed the lack of any clearly- 
defined state policy in the spending of public funds, and the 
lack of any uniform standard in the management of the business 
affairs of the state. 

"It is my judgment as a business man, that these public 
expenditures as a whole do not return more than 50 cents of 
value to the taxpayers for every dollar spent. 

"This absurd condition is precisely what would be expected 
in any business house if there were no well-defined and central- 
ized business responsibility. 

" In my opinion the best way to remedy this condition is to 
establish at once a state finance board. This board should 
consider the total expected annual revenues of the state, and, 
after mature deliberation, should estimate what percentage of 
these funds could be reasonably expended on each branch of 
the state's business. 

"They should also have power to investigate and report on 
the business methods of the various county governments and, 
when occasion demands, city and town governments, as I 
recommended in my inaugural message. 

"They would sit throughout the year, and act in close and 



THE GOVERNOR AND THE BUDGET 55 

continuous cooperation with the various head officials of de- 
partments, boards, and institutions of the state. 

''They should hear the opinions of such officials and consider 
these, not separately, as is now done by the ways and means 
committee, but together and in comparison. They could thus 
arrive at a fair distribution of the state's income. 

"One of their duties would be to present to the legislature, 
when it convenes, their estimate of the sums needed by each 
division of the state's business, and this estimate should be 
used by the legislature as a check upon the estimates now sub- 
mitted by the heads of these divisions. 

"By this method, the legislature would have before it a busi- 
nesslike analysis of the fiscal situation, at the start. It would 
be assisted in its duty of checking extravagance, and with the 
help of the finance board the legislature could do more in two 
months than it now accomplishes in six. 

"Our existing law fi^es upon the governor the duty of pass- 
ing upon pending appropriations immediately upon his as- 
sumption of office. Thus the legislature is required to wait 
while the necessary survey of these expenses is made by the 
executive. Under the businesslike plan proposed this would 
be finished when the legislature convened." ^ 

The Republicans, who had made the governor the initia- 
tor of financial legislation only to have the new position 
of power captured by the forceful and popular leader 
of the opposition and used for what they regarded as 
partisan ends, also learned a few things during the session 
of 191 1. Every attempted disclosure of inefficiency and 
favoritism was a criticism of previous Republican rule. 
As a result the ^^ experts" of the governor were thoroughly 
hated. Theirs was a thankless task at any rate, and the 
necessary superficiality of most of the investigations gave 

1 Special Message of July 10, 191 1 ; Acts of 191 1, p. 1265, 



56 BUDGET IN MASSACHUSETTS 

an opening for attack. But further than this it became 
clear to the Republicans that the financial powers recently 
given the governor and the Democrats must be restored 
to the legislature and the Republicans, or at least to a 
body of men under their control.^ Norman H. White, 
a prominent Republican and chairman of the house ways 
and means committee, claimed that the executive was 
usurping the powers of the legislature.^ Thus ended the 
drawn battle of 191 1. 

Party Platforms of igii. 

As was to be expected, the 191 1 Democratic platform 
contained a new plank demanding "a permanent state 
finance commission '^ in accordance with the recommen- 
dations of Governor Foss.^ The Republican platform 
dropped its hearty endorsement of the laws which had 
"placed upon the governor direct responsibility for all 
estimates,'' ^ and taking up the defensive, maintained that 
"out of the futile search of our opponents has come an 
overwhelming vindication" of the Republican adminis- 
tration of departments and institutions.^ 

The Creation of the Commission on Economy and Efficiency. 
Governor Foss was reelected by a substantial majority. 
In his inaugural address he repeated his recommendation 
for the creation of a state finance board. 

1 The Boston Democrats joined the Republicans in this feeling, though with 
them it appears to have been solely a desire for legislative influence, (Cf. 
Lomasney in ways and means com.mittee hearing on Judicature Commission 
bill, 191 7.) 2 jjennessy, p. 236. 

^Boston Transcript, October 5, 1911, p. 6, Acts 1912, p. 952. 

*From 1910 platform, p. 43 ante. ^Boston Herald, October 5, 1911, p. 4. 



THE GOVERNOR AND THE BUDGET 57 

The legislature was still more Republican than its 
predecessor and was of course only too ready to repeal 
the Walker Act. The creation of a state finance board 
to be appointed by the governor and council would be a 
great improvement, it was said, because the council, being 
elected by districts, was also an entrenched Republican 
body.^ Thus the governor's recommendation and the 
legislature's wish coincided, and as a result the Walker 
Act was repealed and a "Commission on Economy and 
Efficiency" created, consisting of the auditor, and two 
appointees of the governor and council. The governor 
was to designate the chairman, and provision was made 
for a secretary and the necessary clerical force.^ 

Estimates to Auditor, 

The new law required every officer or board having 
charge of any department, institution, or undertaking 
which received an annual appropriation of money from 
the state treasury to submit to the auditor, on or before 

^ In vetoing the bill providing for salary increases for the members of the 
council during the previous session, Governor Foss had paid his respects to that 
body in these words : 

"The Council was created in conformity with European and Colonial prec- 
edents to advise the chief executive upon state matters, but, as an institution, 
it is not in keeping with our democratic form of government. 

"The Council possesses no working organization for the conduct of any 
productive public work; and is not vested with any constitutional power to 
initiate any public service. It is an auxiliary to the executive and for this reason 
it may be urged that the Council furnishes a check upon the acts of a chief execu- 
tive moved by political motives. But if so, it is true that the Council must 
equally thwart the wiU of that majority of the people by whom the governor is 
elected." (Veto message of May 18, 1912, Acts of 1912, p. 1065.) 

2 Acts 191 2, Ch. 719. 



58 BUDGET IN MASSACHUSETTS 

November 15 of each year, statements showing in detail 
the amounts appropriated for the current fiscal year; 
estimates of the amounts required for the coming fiscal 
year for ordinary running expenses, with an explanation 
of the reason for any increase and with citations of stat- 
utes relating thereto ; and the expenditures for the 
current year and also for the two preceding years. 

Officers, heads of departments, boards, and commis- 
sions, and trustees of institutions who recommended 
appropriations from the state treasury for special pur- 
poses were required to submit detailed estimates to the 
auditor on or before November 15 of each year. 

Estimates of Expenditures and Revenues to Governor^ 
Commission^ and Legislature. 

The auditor was required to prepare two documents; 
one an estimate for ordinary running expenses, the other 
for special purposes. These he was required, on or before 
December 15, to submit to the governor-elect and to 
the commission on economy and efficiency ; and on or 
before the first Thursday in January, to transmit printed 
copies to the legislature. 

Form and Content of Estimates. 

The estimates for ordinary requirements were to in- 
clude : the estimates proper, together with a statement 
of the general appropriations for each unit of organiza- 
tion and the expenditures thereof for the preceding fiscal 
year, and the unexpended balance as of the preceding 



THE GOVERNOR AND THE BUDGET 59 

November 30; also the statements received from the 
heads of the various organization units, together with 
the auditor's estimate for the ensuing fiscal year of the 
ordinary and other revenue of the state. 

The estimates for special purposes were required to be 
classified by the auditor. 

Examination of Estimates by Commission. 

In neither case was the auditor authorized to revise 
estimates. The commission on economy and efficiency, 
however, was required to examine the auditor's state- 
ments and report thereon to the legislature on the day 
that the auditor submitted his tabulations to the legis- 
lature, and at such other times as it might see fit, "to- 
gether with such facts, suggestions or recommendations 
as to any or all of the appropriations requested or the 
method of raising money for the same as it may deem 
expedient." 

Investigation and Reports. 

Various provisions of the law related to the investi- 
gating work of the commission, which was authorized 
to require the attendance of witnesses and to examine 
accounts and documents. It was authorized to make 
special examinations of the management or finances of 
any department, institution, or undertaking receiving 
an annual appropriation, and to report thereon from time 
to time to the governor and council and to the legislature 
if in session. Upon request of either branch of the legis- 



6o BUDGET IN MASSACHUSETTS 

lature, of the ways and means committee of either house, 
of the governor, or of the finance committee of the council 
the commission was required to make a special exami- 
nation, and also to give any information in its possession. 

Furthermore, the commission was required to inquire 
into the laws governing financial procedure, to consider 
the possibility of promoting economy and efficiency by 
changes in the law, organization, or procedure, and "by 
the substitution of the budget method of appropriating 
money," and to report on these matters from time to time 
to the governor and coimcil and to the legislature if in 
session. 

A general report was also required to be made to the gov- 
ernor and council and to the legislature in January of each 
year, with drafts of bills for any suggested legislation.^ 

Governor Eliminated from Appropriation Process. 

This new act deprived the governor of the right to 
investigate departments, to hire experts and to initiate 
a budget. That this was intentional and was the result 
of political friction was recognized in the constitutional 
convention of 191 7, where the creation of the commission 
on economy and efficiency was mentioned as a case in 
which the legislature "put it over" the governor. ^ 

Personnel of the Commission. 

The commission on economy and efficiency was first 
composed of John N. Cole, chairman, and Francis X. 

^ Acts 1912, Ch. 719. 

2 Convention Debates, 2d Session, Vol. 108, p. 9. See page 145. 



THE GOVERNOR AND THE BUDGET 6i 

Tyrrell, with John E. White, auditor and member ex 
officio.^ Mr. Tyrrell became chairman in 1914 on the 
resignation of Mr. Cole, and Thomas W. White was 
added. In the same year the organization of the com- 
mission was changed by dropping the auditor and adding 
a third appointive member.^ This position was filled 
by Russell A. Wood until 191 6 when Charles F. W. Archer 
was appointed. All of these appointees, with one excep- 
tion, were good Republicans — an evidence of the success 
of the attempt made by the legislature to cut down the 
investigatory and financial power of the governor by turn- 
ing these powers over to a commission appointed by the 
governor and council. The single exception was Mr. 
Tyrrell, who gained control of the commission in 191 4. 

Supervisor of Administration Replaces Commission. 

The work of the economy and efficiency commission 
under the chairmanship of Mr. Tyrrell was far from 
''satisfactory" to the dominant party in the legislature. 
This, and the fact that the Republicans had regained 
the governorship through the election of Samuel W. 
McCall, brought about and made possible the transfer 
of the powers of the commission to "safer" hands. As a 
result the commission was summarily abolished in 1916 
and its powers transferred to the new department of 
the supervisor of administration.^ In making this trans- 

1 Mr. White was the nominee of the Republican caucus elected by the legis- 
lature to fill the vacancy created by the death of Auditor Turner in 19 ii. 
Hennessy, p. 260, 

2 Acts of 1914, Ch. 698. 3 j^^^ ch. 296. 



62 BUDGET IN MASSACHUSETTS 

fer, the former powers of the commission were still further 
reduced. The supervisor was authorized to make investi- 
gations and recommendations on estimates only on the 
request of the legislature, the ways and means committees, 
the governor, the council, or the finance committee of 
the council. The power of the supervisor to compel 
the production of books and the attendance of witnesses 
was similarly hmited to authorized investigations. 

Charles E. Burbank, a progressive Republican who had 
been prominent in the reuniting of Progressives and Re- 
publicans for the McCall ticket was appointed supervisor 
of administration. Thomas W. White and Ernest H. 
Maling were appointed deputies and Charles F. W. Archer 
secretary. Mr. Maling resigned later in the year, and 
early in 191 7 Mr. Carl A. Raymond, who had been in 
the auditor's office for many years, took his place. Fol- 
lowing the death of Mr. Burbank, Mr. White became 
supervisor, and Mr. Raymond first deputy.-^ 

Ultimate Result of Walker Act. 

In 1 9 10 the effort was made in the Walker Act to place 
responsibility with the governor for sifting the estimates 
and recommending a financial plan for the government. 
This proved so "unsatisfactory" to the legislature under 
the administration of an opposition governor that it was 
given up and the powers transferred to the commission 
on economy and efficiency. This commission fell into 
"unsafe" hands and was abolished. The attempt in 

* The position of second deputy had not been filled in March, 1920. 



THE GOVERNOR AND THE BUDGET 63 

1 9 10 to make the governor responsible for financial meas- 
ures thus ended by leaving him in precisely the same posi- 
tion he had previously occupied. The only concrete 
result was the development of an efficient staff agency, 
the department of the supervisor of administration. 

Development of Control over Expenditures. 

During the period 1910 to 1918 certain important 
steps were taken in developing the administrative control 
of departmental and institutional expenditures. The 
creation of the department of the supervisor of adminis- 
tration, with its broad investigatory powers, laid the 
foimdations of a supervisory agency. Among his other 
duties, the supervisor was authorized to edit all annual 
and special departmental reports in order to prevent 
unnecessary printing. This placed under his control 
approximately one-third of the state's printing.^ 

During 1916 also, the control of state insane asylums, 
which were spending three to four million dollars annually, 
was taken from the various boards of trustees and en- 
trusted to a commission on mental disease composed 
of a single executive and administrative head and an ad- 
visory commission.^ 

A further act of 191 6 provides : 

"Without the consent and approval of the governor and 
council it shall be unlawful for any head of a department or 
other officer of the commonwealth to increase the salary of any 
employee under his direction who is receiving an annual salary 
of one thousand dollars or more, notwithstanding any act 
heretofore passed authorizing such an increase." ^ 
* Acts of 1916, Ch. 296. 2 ij^^^ ch. 285. 3 j^^^ ch. 2. 



64 BUDGET IN MASSACHUSETTS 

The powers vested in the governor and council by this 
act were exceedingly important. As there were no salary 
standards up to 1919, the governor and council were given 
a very real control over salary increases and by this means 
over appointments and departmental administration.^ 
The lack of any policy and the inability or refusal to handle 
the work scientifically, however, resulted in its degener- 
ation into a personal and political engine rather than one 
of constructive reform. Occasionally salary increase 
questions were referred to the supervisor of administra- 
tion, though his advice was not at all times followed. 

The actual amount of control exercised over depart- 
mental expenditures by the governor and council under 
this power as well as under the powers inherited from the 
earliest days was slight indeed. The supervisor's control 
over printing was effective and efficient, but it did not 
extend far.^ The work of the director of the commission 
on mental diseases was also markedly successful. Except 
for these elements of partial supervision, the only admin- 
istrative control of expenditures was that of the auditor, 
whose sole interest lay in the conformity of expenditures 
to appropriations. 

II. Budget Reform in 191 7 
The failure of the initial attempt to make the governor 
responsible for state finances delayed and made much 
more difficult the course of budget reform. Those who 

* Cf. Economy and Efficiency Commission report, "Red Book," p, 31, "The 
effect of this authority is practically to control appointments." 
2 Cf. 1919 Public Document 119, p. 18 ff. 



THE GOVERNOR AND THE BUDGET 65 

were genuinely interested in reform, however, realized 
the causes of the failure and set about to secure a fair 
trial of the budget system. 

Report of Economy and Efficiency Commission, 

Late in the legislative session of 1916, the commission 
on economy and efficiency issued a "Report on Budget 
Procedure" ^ in which appeared the following "Findings" 
and "Recommendations" : 

Summary of Findings 

The principal disadvantages in the present procedure 
which this report seeks to improve are the following : 

1. Tabulation of estimates : 

a. No complete tabulation of estimates and requests for ap- 

propriations is now made. 

b. The present tabulations (House Documents No. i and 

No. 2) are necessarily incomplete because of the many 
requests for appropriations filed directly with the legis- 
lature. 

c. The present tabulations contain no information concern- 

ing requests for expenditures to be met from loans, and 
no provision is made for compiling such requests. 

2. Review and adjustment of estimates : 

a. The estimates cannot be studied in the aggregate so as to 

consider the relative importance of the many estimates, 
neither can they be considered in relation to the avail- 
able revenue. 

b. The estimates for any individual department or project 

as given in House Doctmients No. i or No. 2 cannot be 
considered with the assurance that they are the com- 
plete or total estimates for that department or project. 

* 1916 House Doc. 2288, May 27, 1916. 



66 BUDGET IN MASSACHUSETTS 

c. No plan for financing the state is now prepared in advance 

of the granting of appropriations and of authorizing 
loans. 

d. The governor has no part in the consideration of esti- 

mates, and is given no facilities for investigating them 
or for taking such part in the financing of the common- 
wealth as the chief executive should take. The governor's 
action is now negative, being restricted to the veto of 
appropriation bills which are passed from time to time 
throughout the whole legislative session (136 such bills 
were enacted in 1915). 

3. Preparation and enactment of appropriation bills : 

a. An unnecessarily large number of appropriation bills is 
now enacted, with the result that the time of the legis- 
lature is wasted. Moreover, difficulty is now en- 
countered in ascertaining from the statutes the total 
amount appropriated for the current expenses of some 
of the departments. 

h. The present method of enacting appropriation bills is 
unsystematic. 

4. Form of appropriation bills : 

a. In drafting appropriation acts little or no consideration 

has been given to the effect which the form of the act 
may have upon departmental administration. As a 
result, the acts for some small appropriations now con- 
tain an unnecessarily large amount of detail, while some 
large appropriations are granted in lump sums. 

b. No standards for the drafting of appropriation acts have 

been adopted, with the result that items for a single 
department may be arranged on two or more bases which 
are inconsistent, thus causing confusion as to the amount 
authorized for different purposes and objects. 

Summary of Recommendations 
For the purpose of making such improvements in the 
methods of granting appropriations as may be effected 



I 



THE GOVERNOR AND THE BUDGET 67 

without amendment of the Constitution, and with- 
out change in the fiscal year, the Commission on 
Economy and Efficiency submits the following recom- 
mendations : 

1. That the Legislature require all bills, resolves and petitions 
for appropriations and bond issues to be filed with the clerk 
of the House of Representatives not later than 5 p.m. on the 
fourth Wednesday preceding the convening of the Legislature, 
and that any such bill, resolve or petition filed subsequent to that 
time be referred to the next General Court. 

2. That provisions be made for the Commission on Economy 
and Efficiency acting for the Governor to prepare complete tabu- 
lations of all estimates and requests, and for that commission to 
investigate and report to the Governor concerning all estimates 
and requests. 

3. That the Governor submit to the General Court not 
later than the first Monday in February a budget containing 
all estimates and requests, with his recommendations as to the 
amoimts which should be granted and the amounts which in 
his opinion should be raised by a State tax and by loans, if 
any. 

4. That a single appropriation bill be enacted for each 
department's expenses of administration, operation and main- 
tenance. 

5. That, so far as practicable, appropriation bills be reported 
and enacted in the order followed in presenting the estimates in the 
Governor's budget. 

6. That definite " budget days " be designated by the General 
Court for consideration of appropriation bills. 

7. That appropriation acts be drawn in such form and detail 
as will afford an effective control over the expenditure of appro- 
priations. 

8. That definite standards be followed in the drafting of appro- 
priation bills so as to insure a consistent and effective system for 
the granting of appropriations. 



08 BUDGET IN MASSACHUSETTS 

Report on Revenues and Loans. 

During the same session the commission reported on 
the administration of state revenues and loans. ^ The 
report pointed out that over $5,000,000 ^ was annually 
expended from special funds without annual appropria- 
tion and said : "So long as large amounts of revenue are 
expended without appropriation, as at present, no genuine 
budget procedure can be put in force. When all expendi- 
tures for state activities are brought within the scope of 
appropriation acts the first step towards budget reform 
will be taken." ' 

Chamber of Commerce Report. 

During 1916 the Boston Chamber of Commerce also 
took an interest in budget reform. It appointed a special 
committee on the state budget which reported late in 
November.* This report endorsed the recommendations 
of the commission on economy and efl&ciency. In place 
of the sifting of estimates by the commission on economy 
and efficiency, which had now been aboUshed, the report 
recommended the establishment of a new "budget com- 
mission" composed of the supervisor of administration 
and the two chairmen of the house and senate ways and 
means committees.^ This budget commission was to 
draw the budget, the governor to present it to the legis- 

1 1916 House Document 2225, April 29, 1916. 

* Ihid.j pp. 35, 65. ^Ihid., pp. 7, 8. 

* November 24, 1916. The committee was : Roland W. Boyden, Charles J, 
Bullock, and Robert Luce. 

» "State Budget System," p. 6. 



THE GOVERNOR AND THE BUDGET 69 

lature with his recommendations, and the legislature to 
revise it up or down at its discretion. 

Though the committee felt that the power to veto 
items in appropriation bills had "no necessary connection 
with the budget system," a constitutional amendment 
granting this power to the governor was endorsed.^ 

The Legislature and Budget Reform. 

Considerable unfair criticism has been directed at the 
legislature of 191 6 for not taking action on the budget 
recommendations of the commission on economy and 
efl&ciency.^ As a matter of fact, these recommendations 
were received so late in the session that the cause of reform 
would only have been jeopardized by any attempt to 
suspend rules and force consideration. The legislature 
and the state as a whole were but slightly educated on the 
budget question in 191 6. 

In 191 7, however, the reports on the administration of 
funds and on the budget were taken from the files and 
referred to the joint committee on ways and means, 
together with a bill embodying the Boston Chamber of 
Commerce recommendations.^ When the current finan- 
cial business had been disposed of, five hearings and several 
executive sessions were held, and a bill reported which 
brought under legislative control, through the require- 
ment of annual appropriations, revenues of special fimds 
previously expended under standing laws and without 

1 "State Budget System," p. 8. 

2 E.g. Journal of Committee on Finance of 191 7, Constitutional Convention. 
' 191 7 Senate Document 88, submitted by Senator Malcolm E, Nichols. 



70 BUDGET IN MASSACHUSETTS 

specific appropriation, amounting to more than $5,000,000 
annually. This bill was passed and approved by the 
governor as Chapter 277 of the General Acts of 191 7. 
This act in itself, and in the principle which it laid down, 
represented the most important single advance in the 
financial administration of Massachusetts since 1910.^ 
It was what the commission on economy and efficiency 
had termed the indispensable "first step towards budget 
reform." ^ 

The pressure of legislative business, the wide differ- 
ences of opinion among members of the ways and means 
committee, and the general apathy of the state as a whole 
on the budget question made it impossible to reach any 
decision with regard to the broader question of the budget. 
It was therefore decided to turn the entire question over 
to a recess committee, a decision in which the friends of 
the budget and the friends of recess committees per se 
concurred. 

In order that this committee might have time to examine 
the departmental estimates and to prepare a tentative 
budget for 191 8, a bill was introduced and passed requiring 
the submission of the estimates on October 15th, a month 
earlier than had been the custom.^ 

1 1918 House Document, No. 1185, page 22. 
2 1916 House Document, No. 2225, page 8. 
3 Acts of 191 7, Chapter 278, General. 



CHAPTER V 

THE JOINT SPECIAL COMMITTEE ON FINANCE AND 
BUDGET PROCEDURE 

The joint special committee on finance and budget 
procedure was created to "investigate and report on any 
and all changes which they may deem necessary for the 
better, more economical and more efficient administration 
of the financial affairs of the commonwealth/' and to 
"concern itself especially with a study of budget proced- 
ure.'' It was provided specifically that the committee 
"shall also consider the estimates caUing for maintenance 
and special appropriations of the departments, boards, 
commissions and institutions of the commonwealth ; and 
it may present in its report a preliminary budget or finan- 
cial scheme for the fiscal year commencing December 
first, nineteen hundred and seventeen." ^ 

Composition of Committee. 

The committee was composed of three senators 
appointed by the president of the senate and six repre- 
sentatives appointed by the speaker. The legislators 
selected were men of long legislative experience, all of 
whom had taken a part, more or less prominent, in finan- 
cial affairs while in the legislature, and seven of whom 

^ House Journal 191 7, p. 1143. 
71 



72 BUDGET IN MASSACHUSETTS 

were members of the ways and means committees during 
the preceding session. The committee was thoroughly 
representative; it contained leaders of the older as well 
as of the newer type; it reflected the viewpoints, the 
desires, and the fears of the chief varieties of political 
opinion represented in present-day state government. 
The committee was thus in a position to work out a plan 
that would be acceptable to the various groups of the 
legislature. It was also linked with the finance committee 
of the constitutional convention through Mr. Collins, who 
served on both committees. 

The members of the joint special committee on finance 
and budget procedure were as follows : Senators James 
W. Bean, of Cambridge; Walter E. McLane, of Fall 
River ; Malcolm E. Nichols, of Boston ; and Representa- 
tives Joseph E. Warner, of Taunton ; Samuel I. Collins, 
of Amesbury; Benjamin Loring Young, of Weston; 
Harrison H. Atwood, of Boston; WiUiam F. French, 
of Haverhill ; and John H. McAllister, of Lee. 

In addition to the duties of the committee with regard 
to the budget, it was required to investigate and report 
on fees and funds, and on the reorganization of the execu- 
tive department by the consolidation and abolition of 
commissions, boards and bureaus.^ The committee fol- 
lowed this natural division of the work and established 
three subcommittees, one on the budget, one on fees and 
funds, and one on consolidation of commissions.^ 

1 House Journal 191 7, p. 1144. 

' House Document 1918, No. 1185, p. 9. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 73 

Subcommittee on the Btcdget. 

The subcommittee on the budget, with which we are 
alone concerned here, was composed of Senator Bean, 
and Representatives Warner and Young. It contained 
pecuHarly able, progressive, and respected men, who 
not only knew the practical problems of government in 
Massachusetts and the balance of interests in the state 
house, but also the general trend of current thought on 
budget questions. 

This subcommittee had two main tasks, first, to pre- 
pare a budget for 191 8, and second, to draw up a statute 
providing for a budget system for the future. As was 
natural, the thinking and the work on the two matters 
went on contemporaneously in part. For the sake of 
clarity, however, the progress of the committee in the 
two fields will be discussed separately. 

I. Preparation of the Budget for 1918 

Staff Assistance of Supervisor. 

The subcommittee on the budget began its work by 
going over the "P.B.L's.," as the recurrent annual ex- 
penditures "provided by law" are termed. This con- 
sideration was continued till November 8th, when the 
departmental estimates demanded the entire time of the 
committee.-^ 

On October 3d, the main committee unanimously 
voted : 

* Journal of Subcommittee on the Budget, p. 8. 



74 BUDGET IN MASSACHUSETTS 

"That the Supervisor of Administration be requested to 
prepare for this Committee a report on all requests from the 
ofl&cers, heads of departments, boards, commissions and 
trustees of institutions for appropriations by the General 
Court in the fiscal year 191 8, both for maintenance and for 
special purposes or objects, and to include all material pub- 
lished in House Documents I and II, and such other estimates 
as should be included therein." ^ 

This action was taken after some discussion and as the 
result of the decision of the subcommittee on the budget 
that the best argument before the legislature for a budget 
would be to prepare a budget and let the legislature see 
how it looked and how really "safe" it was. Both 
Mr. Young and Mr. Warner also argued that after 
the committee had prepared a budget, it would be 
in a better position to know what kind of a statute to 
draw providing for the preparation of budgets for the 
future. 

In accordance with this request Mr. Carl A. Raymond, 
the second deputy in the ofhce of the supervisor of adminis- 
tration, set to work as soon as the estimates were received 
to sift them over and to draw up the rock bottom needs 
of the departments and institutions for the coming fiscal 
year. In arriving at these figures Mr. Raymond held 
informal conferences with the heads of all important 
departments, and in a majority of cases revisions were 
made with the cooperation and approval of the depart- 
ments concerned. 

^ Journal of Joint Special Committee on Finance and Budget Procedure, 
p. 16. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 75 

Institutional Visits, 

In order to be in a better position to consider the in- 
stitutional requests for capital outlays and extraordinary- 
repairs, the subcommittee spent a part of its time during 
October and November visiting the institutions which 
had requested special appropriations.^ Before making 
each trip the estimates of the institutions to be visited 
were gone over and excerpts made of items deserving 
special inquiry. Whenever institutions were visited which 
were under the supervision of the commission on mental 
diseases, Dr. George M. Kline, the director, accompanied 
the committee. 

Beginning on November 8th, ^ and continuing through 
December,^ Mr. Raymond submitted the results of his 
work to the subcommittee from time to time. In almost 
all cases the revisions arrived at by Mr. Raymond were 
adopted. 

Conferences, 

Formal conferences were had with the adjutant-general, 
the state guard, the highway commission, the state board 
of agriculture, the commission on w^aterways and public 
lands, the trustees of the Norfolk State Hospital, the 
board of medical examiners, and the state board of chari- 
ties in order to work over estimates and questions of 

^ 191 7 House Document 1185, p. 9. The entire committee was invited to join 
the subcommittee on these trips. 

2 Journal of Subcommittee on Budget, p. 8. 
^ Journal of Joint Special Committee, p. 29. 



76 BUDGET IN MASSACHUSETTS 

reorganization.^ These were in addition to conferences 
held previously by the supervisor's office, and were made 
necessary because of the peculiarly difficult problems 
which the committee was called upon to settle in drawing 
its recommendations for these departments. 

Budget Policy. 

During its work the committee had occasion to settle 
two very important questions concerning the form and 
content of its tentative budget. Late in September 
Senator Nichols raised the entire question of private 
members' bills and petitions carrying charges on the 
treasury and suggested that ^Hhe committee make some 
attempt through advertising to bring together before 
the convening of the general court all private petitions 
and bills involving any expense to the commonwealth." ^ 

The following draft of such an advertisement was 
presented for discussion by the secretary : 

"The Commonwealth of Massachusetts 
Joint Special Committee on Finance and Budget Procedure 

Room 435, State House 

Appointed under Joint Order of the two branches of the 
General Court on May 25, 191 7. 

The Joint Special Committee on Finance and Budget Pro- 
cedure, appointed to prepare a budget for the fiscal year be- 
ginning December i, 191 7 hereby requests all persons who are 

1 In the case of the Norfolk State Hospital, following the conference, the 
trustees prepared a radically revised estimate. In other cases, revisions were 
made by the subcommittee itself. 

2 Journal of Joint Special Committee on Finance and Budget, p. 12. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 77 

planning to lay before the next General Court petitions and 
biUs involving any expense to the Commonwealth to submit 
the same to this Committee by Dec. ist, 191 7, in order that all 
requests may be included in the complete plan for financing the 
Commonwealth for the coming year. 

James W. Bean, Chairman, 

Joseph E. Warner, House Chairman.''^ 

After considerable debate, it was voted, on motion of 
Mr. Young : 

"That instead of advertising, the committee notify through 
the mail all legislators elect, all towns and cities through their 
duly constituted authorities, and publish in the Boston Adver- 
tiser alone an advertisement similar to that prepared by the 
secretary.'* ^ 

But on further consideration and extended debate, the 
entire matter was laid on the table on motion of Mr. 
Young. 

It was the final judgment of the committee that any 
attempt to gather in the private bills and petitions in this 
way would be unsuccessful and that any recommendations 
would necessarily be superficial and even if thorough 
would be misunderstood and resented. 

The second important decision was v^dth regard to the 
inclusion of recommendations for the debt service and 
for capital outlays in the budget. It was pointed out 
that the newspapers, the legislature, and the public in 
general overlooked these items and therefore had an idea 
that the commonwealth was spending in all about $20,- 
000,000 a year, and that if the committee included every- 

^ Journal Joint Special Committee on Finance and Budget Procedure, p. 13. 



78 BUDGET IN MASSACHUSETTS 

thing in its budget the total would amount to $10,000,000 
more, merely because of these inclusions. The subcom- 
mittee decided that the only thing to do was to make a 
clean breast of the entire affair, to include everything 
in the budget that belonged there and to explain to all 
critics that the seemingly large increase was due in the 
main to the confusing financial system of the past.^ 

The Subcommittee's Budget. 

On December 31st, the subcommittee submitted its 
preliminary budget and a maintenance bill for the coming 
year to the full committee. A discussion of well over 
an hour followed, almost entirely concerning the appro- 
priation for the state guard. Mr. French, who was already 
slated for house chairman of the committee on military 
affairs of the next legislature, stated that he was ready 
to fight in the legislature for a material reduction of the 
appropriation demanded by the adjutant-general. As 
this coincided with the judgment of the other members, 
it was decided to cut the recommended appropriation to 
$350,000 in spite of the political dynamite contained in 
the item. The committee then voted unanimously : ^ 

"That the Table of Estimates, Cuts and Recommendations, 
as prepared by the Subcommittee on the budget, be approved 
as reported with a single change to be incorporated in the 
Budget statement, with reference to the recommendation for 
the State Guard." 

^ Journal of Subcommittee on the Budget, p. 19. 

2 Journal Joint Special Committee on Finance and Budget Procedure, p. 25. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 79 

On motion of Mr. French, it was also voted : 

"That the General Appropriation Bill, providing for the 
maintenance of the Government of the Commonwealth, re- 
ported by the Subcommittee on the budget, be approved as 
reported." 

Budget Submitted to Legislature. 

On January 2, 191 8, the budget was reread, and after a 
few verbal changes in the explanatory statement it was 
unanimously approved, signed and delivered to the clerk 
of the house of representatives for submission to the 
legislature. Copies were prepared for the press and 
distributed late in the afternoon. This ended the labors 
of the recess committee in the preparation of the first 
budget of the state of Massachusetts. It had received 
estimates amounting to $36,064,918.16,^ exceeding by 
many millions the largest total which any preceding legis- 
lature had ever been called upon to consider. 

As a result of hearings, interviews, first-hand visits to 
institutions, committee discussions and Mr. Raymond's 
work, $4,903,593.92 was cut from the departmental 
requests, and appropriations amounting to $31,161,324.24 
were finally recommended.^ On the revenue side the 
committee recommended a state tax of $11,000,000^ 
and appealed strenuously against the issuance of bonds.* 

The following table shows the cuts in departmental 
estimates made by the committee in preparing the tenta- 
tive budget of 191 8 : 

1 1918 House Document 17, pp. 13, 23, 65. ^ Ibid., p. 13. 

^Ibid., p. 17. ^ Ibid., p. 9. 



8o 



BUDGET IN MASSACHUSETTS 



Thde Estimates and the Budget, 1918' 





Departmentai. 
Estimates 


Budget 
Recommendation 


Reduction 




Amount 


Per Cent 
of 

Estimates 


Maintenance . 
Capital outlays 
Interest . 
Deficiency . . 


$ 27,092,806.82 

5,222,111.34 

3,700,000.00 

50,000.00 


$ 25,568,490.35 

1,842,833.89 

3,700,000.00 

50,000.00 


$1,524,316.47 

3,379,277-45 




5-6 

64.7 






Total . . . 


$36,064,918.16 


$31,161,324.24 


$4,903,593-92 


13-5 



The Massachusetts Budget of igi8. 

The budget submitted to the general court on January 
2, 1 91 8, is a statement of twelve pages. It appeared as 
House Document No. 17, together with some fifty pages 
of supporting details and drafts of appropriation and 
other bills to carry out the recommendations of the 
budget. 

The budget is divided into two sections, dealing with 
expenditures and with revenues. The section on expen- 
ditures discusses in order — 

1. Maintenance of established departments and in- 
stitutions. 

2. Deficiencies. 

3. Debt service. 

4. War emergency. 

5. Capital outlay (Institutions, Rivers, Harbors, and 
Highways). 

1 19 1 8 House Documents 17. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 8l 
The section on revenues deals with — 

1. Free cash on hand. 

2. "Ordinary" revenue. 

3. "Other" revenue.-^ 

4. State tax. 

In addition to explanatory text, the budget contains 
five important summary tables. These present : 

1. A statement of the departmental estimates, the 
budget recommendations of the committee, and the 
comparative appropriation for the previous year, for 
the main governmental services classified in fifteen 
groups. 

2. A summary of treasury transactions for the pre- 
vious fiscal year, excluding only trust funds, deposits, 
sinking funds and metropolitan district funds. 

3. Estimated "ordinary" revenue for the coming year 
compared with actual receipts for the past two years, 
classified by 23 sources. 

4. Estimates of "other" revenue for the coming year 
compared with actual receipts for the past year, classified 
by 20 sources. 

5. A balance sheet as of the close of the coming year. 

This last table deserves special attention. Title and 
all it was as follows : 

^ Composed of revenues which since December i, 1917, have been paid into 
the general fund as ordinary revenue in accordance with Ch. 277 of the General 
Acts of 191 7, A separate classification was made merely for purposes of com- 
parison with previous years. (1918 House Doc. 17, p. 16.) 



82 



BUDGET IN MASSACHUSETTS 



Summary of Budget 

Summary of the Plan for Financing the Activities of the Commonwealth for 
the Fiscal Year 191 8 



Estimated 


Estimated 


Free cash on hand 




Expenditures to be 




Dec. I, 1917, say . 


$2,000,000.00 


made for — 




Estimated revenue 




Maintenance . . . 


$23,898,490.35 


from — 




Deficiencies . . . 


50,000.00 


Ordinary revenue 




Funded debt obliga- 




(compared with 




tions .... 


1,600,000.00 


previous years) . . 


12,627,200.00 


Interest .... 


2,100,000.00 


Other revenues . . 


5,426,800.00 


War emergency . . 


870,000.00 


State tax .... 


11,000,000.00 


Capital outlays for 




Bond issues .... 




public works, con- 




Accumulated funds 




struction, improve- 




derived from in- 




ments, etc. . . . 


1,842,833.89 


come of State prop- 




Maintenance of in- 




erty, etc., under 




dustries of certain 




control of the Com- 




institutions . . . 


800,000.00 


mission on Water- 




Overlay . • • • 


292,675.00 


ways and PubHc 








Lands .... 


^400,000.00 


Total .... 




Total .... 


$3i»4S4,ooo.oo 


$31,454,000.00 



Supporting Details, 

The second section of House Document No. 17 con- 
tained first of all a tabular presentation of the mainte- 
nance estimates filed by the 132 spending units, the budget 
recommendations of the committee, and the difference 
between the two. Comparative data on past expendi- 
tures appeared in House Document No. i, together with 
the detailed requests of the departments. 

This tabulation was followed by a single maintenance 
appropriation bill embodying the recommendations of 
the committee. It was deemed advisable to draw up 
such a bill in order to overcome the long-standing habit 



THE JOINT SPECIAL COMMITTEE ON FINANCE 83 

of preparing a hundred or more separate bills and in order 
to show in concrete form the advantage of expressing the 
appropriation in semi-tabular form with figures instead 
of close text with spelled out numbers. In both of these 
efforts the committee was successful, as will be seen by 
reference to the bill finally passed.^ The committee's 
bill covered 36 pages and contained 502 items amounting 
in all to $24,496,990.35. The total for each spending 
imit was added up as a basis of comparison with the pre- 
ceding tabular summary and House Document i. It is 
to be noted especially that the bill contained the annual 
appropriations for the legislature and the judiciary along 
with all other state departments. 

The next statement presented in tabular form the 
estimates for capital outlays and special improvements, 
together with the committee's recommendations. These 
covered five pages and were classified by the 28 spending 
imits which had filed such estimates. The recommenda- 
tions of the committee on capital outlays were included 
in the budget,^ but not in the general appropriation bill, 
inasmuch as there was no legal authorization as yet for 
these appropriations.^ 

The final pages of House Document 17 contain the 
drafts of five bills, the passage of which was imperative 
before the enactment of the general appropriation bill. 
These were : 

1 Ch. 106, Sp. Acts, 1918. 2 See "Budget Summary" on page 82. 

^ The general appropriation bill contained over $500,000 for capital outlay 
for highways, harbors and forest lands in accordance with existing authoriza- 
tions. (House Doc. 17, pp. 12 and 13.) 



84 BUDGET IN MASSACHUSETTS 

1. An act authorizing the payment of salaries and trav- 
eling expenses of members of the legislature in anticipation 
of appropriations. (This act was recommended in order 
that there might be no effort in the legislature to tear apart 
the general appropriation bill, by the immediate passage of 
that section dealing with members' salaries and expenses.) 

2. An act repealing a section of the revised code fixing 
the "expenses" of the executive department and substitut- 
ing for it the provision that the amount was to be deter- 
mined by annual appropriation. (The amount fixed 
by law was clearly insufficient. It had forced a round- 
about method of evasion which the committee felt should 
be eliminated by allowing an adequate appropriation in 
the budget.) 

3. An act to discontinue the newspaper publication 
of the general laws. , (The budget recommended no 
appropriation for this publication.) 

4. An act to discontinue the purchase of historic town 
records of births, marriages and deaths. (The budget 
recommended no appropriation for these purchases.) 

5. An act relative to the preparation of the indices 
and of the table of changes in the general laws. (This 
act shifted certain clerical duties and functions in accord- 
ance with the budget recommendation.) 

II. Providing tor a Budget System 

The second main task before the subcommittee on the 
budget was to work out the details of a bill to establish 
the budget system in Massachusetts. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 85 

Budget Views of Committee Members. 

In spite of the long continued agitation for budget 
reform there was no consensus of opinion in the state on 
details. The joint special committee itself represented 
all types of opinion on the budget, some members going 
so far as to oppose during the earlier discussions any 
change whatsoever. A clear majority were at first against 
any increase of the governor's powers and therefore op- 
posed allowing him to draw up a budget. Even in the 
subcommittee on the budget there was a decided differ- 
ence of opinion. This was brought out clearly early 
in July when its members appeared, on invitation, before 
the ^'Committee on State Finance" of the constitutional 
convention, which was at the time working over the budget 
proposals submitted to the convention. The testimony 
of Messrs. Young, Warner and Bean at this time is sig- 
nificant as indicating their views before the subcommittee 
entered upon a thorough discussion of the budget. 

Mr. Young argued for a constitutional amendment 
requiring the submission of a budget by the governor, 
allowing revision by the legislature either by increasing 
or decreasing items, and granting the governor the power 
to veto or decrease items. On the specific question of 
increase of items by the legislature he said : "The power 
to increase should be left with the legislature. This 
power will not be abused because it will have to over- 
come the prestige which will attach to a measure recom- 
mended by the governor." ^ Mr. Young favored a broad 

^ Journal of Committee on Finance, p. 10. 



86 BUDGET IN MASSACHUSETTS 

amendment which would leave all details to be determined 
by the legislature, even with regard to a limitation on 
the passage of private bills and resolves carrying charges 
on the public treasury.^ 

Mr. Warner agreed with Mr. Young "absolutely," 
as he put it, though there were many matters concerning 
which he had arrived at no definite conclusion. It was 
his opinion that if a restriction on private bills proved 
necessary, it should be imposed by the legislature itself, 
as in England, and not by a constitutional amendment. 
Mr. Warner was convinced that a restriction would not 
prove indispensable to a budget, for " the power to increase 
items will not be abused — it will not even be used except 
for good cause shown." ^ 

Senator Bean said : "I am not in favor of an executive 
budget. We tried it in 191 1 and the only result was a 
failure. It stirred up hard feeHng between the legislature 
and the governor and dragged the session on through the 
summer. I am in favor of a recess committee of the two 
houses on ways and means to look over requests for appro- 
priations, to follow up the expenditures, and to make 
recommendations to the incoming ways and means com- 
mittee. This method would get the best results." ^ 

On the question of special bills, Mr. Bean believed that 
the adverse report of the ways and means committee 

* Journal of Committee on Finance, p. 14. ^ Ibid., p. 11. 

^ Ibid., p. 14. Mr. Tyrrell of the Commission of Economy and Efl&ciency, 
who was present, denied that an adequate trial was given the executive budget 
in 191 1, since there was at the time no adequate staff agency to assist the 
governor. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 87 

would be a more powerful deterrent than any provision 
requiring an unusual vote in the legislature. He pointed 
out that time honored custom, and the constitution, 
had made "the right of private petition sacred," and 
that its restriction by prohibiting financial measures not 
in the budget would be foreign to the traditions of Massa- 
chusetts. 

The testimony of these three men is interesting as an 
indication of the point which the members of the com- 
mittee had reached in their thinking on the budget before 
they undertook the specific task of preparing a budget 
statute for the commonwealth. 

Little Discussion of Budget Problems till December. 

At the time the committee on finance of the constitu- 
tional convention made its report, an informal exchange 
of views among members of the recess committee showed 
considerable opposition to the preparation of the budget 
by the governor and especially to the proposition that he 
be allowed to defend his budget on the floor of the legis- 
lature. Even Mr. Collins, who as member of the com- 
mittee of the convention had not voted against the prop- 
osition, joined in the criticism of these features and pre- 
dicted the defeat of the entire budget resolution in the 
convention. 

In spite of this early discussion of budget proposals no 
real consideration was given the matter till late in Decem- 
ber. For the time being the energies of the committee 
were devoted to other and more pressing matters. The 



88 BUDGET IN MASSACHUSETTS 

subcommittee on the budget made its institutional visits 
and struggled away with the 191 8 budget. The other 
subcommittees were engrossed with other matters. The 
November election absorbed the time of some, as did 
also the city election in December. Senator Bean, the 
chairman of the committee, and a member of the sub- 
committee on the budget, failed of reelection in November, 
and the work on the 191 8 budget was thus left largely in 
the hands of Mr. Warner and Mr. Young. 

The Budget Program of Mr. Warner and Mr, Young, 

By the middle of December, Mr. Warner, Mr. Young, 
Mr. Raymond and the secretary of the committee were 
agreed on the main provisions of the budget statute to 
be recommended by the subcommittee. The chief diffi- 
culty lay in making the measure revolutionary enough 
to be valuable and conservative enough to "get by" 
the main committee and the legislature. The compro- 
mise arrived at was : 

1. The preparation of the budget by the supervisor 
of administration, on the basis of departmental estimates. 

2. The revision and submission of the budget to the 
legislature by the governor. 

3. A single appropriation bill providing for budget 
recommendations with precedence over all other appro- 
priations. 

4. No interference with the power of the legislature 
to increase or decrease items in the governor's budget 
or to introduce private bills or accept private petitions. 



THE JOINT SPECIAL COMMITTEE ON FINANCE 89 

At various times the elements of this program were 
discussed with other members of the committee individ- 
ually in order to insure its adoption when the time was 
ripe for discussion by the conmiittee as a whole. By 
this time all members of the committee either believed 
in a budget and a single appropriation bill, or else felt 
it could do no special harm. Several members who had 
opposed the governor's revision and presentation of the 
budget were swung around by the argument that the 
passage of the suggested measure would ''steal the thun- 
der" of the constitutional convention and would ''put 
the governor on record" on all financial matters so that 
he could not shift the blame to the legislature for allowing 
appropriations he had secretly urged them to make. 
The action of Governor McCall in bringing pressure to 
bear on the house ways and means committee in 191 7 
to reverse their adverse report on an appropriation for 
the Pilgrim Tercentenary Commission, the passage of 
which he followed with a veto, was still fresh in the minds 
of all. In spite of these arguments, however, the passage 
of the measure appeared doubtful when it was first dis- 
cussed on December 27th, on the eve of the convening 
of the legislature, and of the presentation of the final 
report of the committee.^ 

Time Limit Forces Decision. 

Because of the inabihty of the full committee to agree 
on the budget statute, and especially on the section of 

^ House Journal 191 7, p. 1143, Journal of Committee, p. 28. 



go BUDGET IN MASSACHUSETTS 

the report dealing with consolidation of commissions, 
an extension of three weeks' time was secured in which 
to arrive at a decision and to complete the report.^ These 
three weeks were busy days for all the surviving members 
of the committee.^ Four of the members were committee 
chairmen, and the remainder were on the house ways 
and means committee, which was holding hearings during 
the same period on the 191 8 budget.^ As a result, further 
consideration was virtually impossible, and as it was 
necessary to report something, the various subcommittee 
reports were acquiesced in and adopted, including the 
budget statute, to which opposition had arisen earlier, 
and the highly controversial sections on administrative 
reorganization. In the latter case, however, the follow- 
ing door was left ajar : 

"The above recommendations have been approved by the 
committee but not in every case by a unanimous vote." * 

The Budget Recommendations of the Recess Committee. 

The report of the committee, in so far as it relates to 
the budget^ is significant because it is a legislative criticism 
of legislative financial practices. "Massachusetts now 
has no budget system," said the committee. "When the 
General Court meets in January there is no unified plan 
for the expenditures and taxes of the year." 

^1918 House Journal, page i66. 

2 Mr. Bean and Mr. Collins were not members of the 19 18 legislature. 

'Manual 1918, p. 519 ff. 

* 1918 House Document, No. 1185, p. 67. 



i 



THE JOINT SPECIAL COMMITTEE ON FINANCE 91 

Criticism of Defects. 

The main defects in the financial procedure pointed 
out by the committee were : 

I. There are no satisfactory estimates of the financial 
needs of government. 

The committee said in part : 

"The estimates are prepared solely by the departments in 
charge of the work to which they relate and by the officers who 
will actually expend the appropriations when made. The 
figures are often unduly high in the expectation that reductions 
will be made by the Committee on Ways and Means. Even 
if not intentionally excessive their value is lessened by the fact 
that they represent the partisan opinion of an interested de- 
partment which naturally wishes its work to cut a large figure 
in comparison with other public activities. 

"Furthermore, the individuals who are responsible for pre- 
paring the estimates have absolutely no responsibility for the 
State tax ; their only interest is to see their departments well 
supplied with public funds. They are under no pressure to 
keep the State tax down." ^ 

It was further pointed out that the estimates now 
prepared are seriously incomplete, not even containing 
the total requests of department heads, to say nothing 
of the flood of private bills and petitions involving a 
financial charge. On the question of estimates the com- 
mittee concluded : "This present procedure in the prep- 
aration and tabulation of estimates fails to give the 
legislature a comprehensive plan of the actual needs of 
the government. '^ ^ 

* 1918 House Document, No. 1185, page 16. ^ Ihid.y page 18. 



92 BUDGET IN MASSACHUSETTS 

2. An orderly consideration of financial measures is 
impossible. 

After pointing out that orderly consideration is con- 
ditioned upon an orderly plan and calling attention to 
other undesirable features of the present procedure, the 
committee concludes : 

"The worst feature of the present system is the impossibility 
of giving proper consideration to all of the needs of the State 
government, in relation to each other and in relation to the 
revenues of the State and the State tax. Individual matters 
are decided and enacted one by one throughout the length of 
the session, without the formation of any definite plan, except 
as one exists in tentative form in the mind of the Ways and 
Means Committee. The public and the Legislature have no 
idea until the last days of the legislative session what the 
appropriations will amount to and what the State tax will be. 
This is due to the lack of comprehensive budget plan upon 
which all appropriations can be based." ^ 

3. "The process of appropriation is confusing both 
to the Legislature and to the public." It was pointed 
out that there were 136 separate appropriation acts in 
1915 and 116 in 1917, and that "The large number of 
appropriation bills at present prepared and passed makes 
it impossible for any individual not an expert to ascertain 
what has been appropriated for any one department or 
for any given service." ^ 

Curative Recommendations, 

In order to cure these outstanding evils, the committee 
recommended that : 

* 1918 House Document No. 1185, page 20. ^ Ibid., page 21, 



i 



THE JOINT SPECIAL COMMITTEE ON FINANCE 93 

1. The budget system be adopted. 

2. The budget be prepared by the supervisor of admin- 
istration under the direction of the governor, for, in the 
words of the committee: "The governor should be held 
responsible for state expenditures. He should therefore 
be originally responsible for the entire financial pro- 
gram." ^ 

3. "Budget Days" be set aside for the consideration 
of the budget, when the governor may be permitted and 
the heads of other executive departmxents may be required 
"to appear before the general court on its request to 
explain the appropriations recommended in the budget." ^ 

4. The legislative rules be changed to require the 
presentation of all private financial bills and petitions 
during the first week of the session and their immediate 
consideration by committees of original reference. 

5. All appropriations based on the budget be included 
in a single "general appropriation bill" to be given pre- 
cedence over all private appropriation bills.^ 

These were, in brief, the budget recom.mendations of 
the committee. In addition 19 specific major recom- 
mendations were made with regard to funds, fees, fines, 
bonds, printing, public institutions, the courts, and depart- 
mental reorganization. These dealt only indirectly with 
budget problems and are therefore not reviewed here. 

* 1918 House Document 1185, page 24. * Ibid, 

^Ibid.f page 72. 



CHAPTER VI 

THE LEGISLATURE OF 1918 AND THE BUDGET 

Governor McCall and Speaker Cox Advocate the Bvdget 
System. 

The legislature of 191 8 was convened on January 2, 
Channing H. Cox, Republican, was elected speaker of 
the house by a vote of 172 to 54.^ In his opening remarks, 
this legislative leader of the majority party stated that 
the first task before the legislature was the estabHshment 
of a "more scientific method of making appropriations.'' 
He continued, "The report of the special committee 
which has been studying this subject during the recess 
deserves our immediate attention and action. As one 
looks back over the legislative history of the common- 
wealth he is astounded to find that, with no real budget, 
with little or no advance investigation of estimates, the 
appropriating power has been used as wisely as it has." ^ 

On January 3, Governor Samuel W. McCall laid 
before the two branches his legislative program. As was 
natural, this war time inaugural address placed special 
emphasis on war measures. It also contained the gover- 
nor's industrial and social program, a word on education, 
on the constitutional convention, and an exhortation 

1 191 8 House Journal, p. 6. ^ lUd.^ p. 6. 

94 



THE LEGISLATURE OF 1918 AND THE BUDGET 95 

to rigid economy. At the request of budget advocates, 
the governor included a paragraph referring to the work 
of the joint special committee on finance and budget 
procedure and urging the legislature to establish a budget 
system. He said, 

**A legislative committee on finance and budget procedure 
has given the subject of a state budget very exhaustive con- 
sideration during the recess. I have referred upon former 
occasions to the need of providing for an efficient budget 
system. The constitutional convention has under considera- 
tion an amendment to the constitution providing for a budget, 
but until that is passed by the people, legislative action upon 
this subject cannot bind governors or subsequent legislatures. 
But it would be binding upon the departments and would 
probably be followed as a rule of action. As chief executive, 
with a high responsibility for administration, the governor 
should be enabled to examine all estimates of appropriations, 
and to submit to the legislature a budget containing a state- 
ment of appropriations deemed by him to be necessary for the 
proper maintenance of the government. This budget should 
include the amounts required for ordinary maintenance, to 
meet deficiencies, to pay interest and maturities upon debt, 
and also to provide the additions and improvements to exist* 
ing institutions which may seem necessary or desirable. The 
recommendations for spending money might well be accom- 
panied by recommendations for raising it, whether by loans or 
new taxes. A haphazard system of public finance is likely to be 
an expensive system. The comprehensive grouping of the 
financial needs of the government will result in the saving of 
time to the legislature, a better apportioning of appropriations 
among the different departments and a lessening of expendi- 
ture. I heartily recommend action designed to secure a proper 
budget system." ^ 

* 1918 Senate Documents, No. i, p. 13. 



96 BUDGET IN MASSACHUSETTS 

Budget Progress in the Legislature, 

It will be seen that the members of the recess committee 
had not been resting on their oars in the matter of secur- 
ing a most favorable introduction for their budget recom- 
mendations. The two men to whom the commonwealth 
looks for leadership at the state house, the governor and 
the speaker of the house, were both induced to come out 
squarely for the adoption of a state budget system, and 
to refer specifically to the recommendation of the joint 
special committee on finance and budget procedure. 
Elements of humor were not lacking in this situation. 
It will be remembered from the discussion in Chapter V 
above that the recess committee had not completed that 
section of its report which was to deal with the state bud- 
get system at this time, and that differences of opinion 
threatened to prevent a satisfactory report. Both the 
governor and the speaker were in a measure endorsing a 
blank check. 

The work of the 191 8 legislature on budget matters 
revolves about two centers, first, the 191 8 budget; and 
second, the bill establishing the budget system. The 
legislative history of these two matters is discussed sepa- 
rately in this and the following chapter. 

Legislative Consideration of the 1918 Budget 
Public Interest in the igi8 Budget, 

The 1 91 8 budget as drawn by the joint special com- 
mittee on finance and budget procedure was submitted 



THE LEGISLATURE OF 1918 AND THE BUDGET 97 

to the legislature on January 2, 191 8. The budget sum- 
mary, excluding the supporting details/ was also handed 
to the press representatives. The prominence which 
the more serious papers gave to this material is perhaps 
the best indication of the extent of public interest in the 
new budget. Of course there were even some Boston 
papers that took no notice of the 191 8 budget. There 
were also many papers of the smaller cities and towns 
that overlooked it.^ The more substantial papers how- 
ever showed an intelligent interest. The Boston Tran- 
script printed the essential details of the 191 8 Budget 
in a two-column box. It hailed the document as the "first 
model budget" of Massachusetts, and presented in tabu- 
lar form the departmental requests, the budget recom- 
mendations, and the 191 7 appropriations. The budget 
simimary was also reprinted in full.^ The Springfield 
Republican not only covered the budget in its news col- 
umns, but took occasion to comment editorially on some 
of the chief political issues involved, observing, ''A num- 
ber of issues are stated clearly in the preliminary budget 
plan of the legislature's special recess committee." ^ 
If one thing is more noticeable than others in this public 
discussion of the 191 8 budget it is the directness with 
which the papers proceeded to the emphasis, in news 
columns, and to the discussion, in editorials, of the chief 
political issues raised by the budget. 

* See page 83. * Cf. the Lowell Courier Citizen, 
' Boston Transcript J January 3, 1 918, p. 2. 

* Springfield Republican^ January 3, 191 8, p. 2 ; January 4, p. 6. 



98 BUDGET IN MASSACHUSETTS 

Conflict with the Senate over Committee Reference. 

Both Mr. Warner and Mr. Young had come to feel 
that it was to the best interests of the legislature to pro- 
vide for the consideration of the budget by the joint 
committee on ways and means. This procedure would 
make it unnecessary for the budget bill to receive the 
attention of the house committee and then of the senate 
committee separately. It would obviate the necessity 
of calling in the department heads for two separate 
legislative committee hearings, and would make it possible 
by eHminating the duphcate hearings to enact the appro- 
priation bill early in the session so that the departments 
could go about their year's work without further delay 
and doubt. The very fact that the two committees 
worked out a joint program would mean the saving of 
time later on. It was also pointed out that practically 
all other legislative matters were reported on by joint 
committees. There were those also who believed that 
the small senate committee, which works comparatively 
in the dark, would needlessly delay action on the budget 
appropriation bill as a means of bringing pressure to bear 
on some legislator or some administrative department for 
personal ends, and that this danger would be considerably 
lessened if the committees acted jointly. As a result of 
these suggestions, and especially because of the influence of 
Messrs. Young and Warner, no difficulty was raised in the 
house against the reference of the budget and the budget ap- 
propriation bill to the joint committee on ways and means.-^ 

* House Journal, p, 23. 



THE LEGISLATURE OF 1918 AND THE BUDGET 99 

The senate, however, refused to concur in this reference, 
and on informal conference no progress was made. As 
a result the house ways and means committee proceeded 
to go over the budget as if it had been referred to them 
alone.^ 

Budget Revisions of the House Committee. 

The house ways and means committee devoted from 
January 7 to January 25 to the revision of the budget 
bill with its 502 items totaling $24,496,990.35.^ While 
no public hearings were held during this period, all heads 
of departments who felt that mistakes had been made 
in the budget recommendations for their work were given 
an opportunity to present their cases. Over half of the 
departments affected either expressed themselves as being 
satisfied with the budget recommendations or failed to 
make a protest. 

On January 25, Chairman Warner reported to the house 
the recommendations of the committee. The new bill 
differed in certain particulars from the old. It contained 
two new items, so that the items numbered up to 504, 
and dropped several. The total appropriation carried 
by the bill was $27,464,746.39.^ 

It will be seen that the bill reported by the ways and 
means committee appropriated almost $3,000,000 more 
than the budget bill. An analysis of the two bills shows 
however that the two bills are not strictly comparable 

^ The Legislative jjoumals were never corrected to indicate what actually 
happened. See House Journal, p. 23, Senate Journal, p. 122. 
2 House Document 17. ^Ibid., 11 76. 



lOO BUDGET IN MASSACHUSETTS 

until certain allowances have been niade. At the time 
the original budget bill was drawn, the treasurer had 
not been able to determine the exact amounts needed 
for interest and debt service, and as a result it was not 
possible to include any definite amount in the budget 
bill. By the time the ways and means committee made 
its revision, the treasurer reported that $3,641,164.09 
was required. This amount was therefore included in 
the revised budget bill. It accounts for the two addi- 
tional items, numbers 503 and 504. 

An important political controversy had arisen over 
the state guard and the adjutant general's department. 
The adjutant general and the officers of the state guard 
were attempting to enlarge their establishments beyond 
what the legislature deemed necessary. The governor 
sided officially with the military authorities, as is evi- 
denced by his inaugural, while the ways and means com- 
mittee urged the need of economy. The committee on 
military affairs was of course the storm center, and as 
it had not reached a decision at the time the budget bill 
was revised, the six items in question were cut from the 
bill and a report on them postponed pending action by 
the committee on military affairs. These military items 
totaled $405,000. A further item of $13,000 for the 
maintenance of the police steamer Lexington was also 
omitted pending action on a message from the governor 
of January 22 advising the sale of the steamer.^ Because 
of the uncertain authority for the appropriation of cer- 

* 19 1 8 House Journal, p. 148, 



THE LEGISLATURE OF 1918 AND THE BUDGET lOi 

tain educational gratuities, three items of the budget 
bill carrying $180,000 were also temporarily dropped. 
And finally an item of $15,000 was added to meet an 
obligation which the recess committee did not understand 
as having accrued.-^ 

When allowances are made for these non- comparable 
items, the two bills are as follows : 

Budget Bill (House 17) $23,913,990.35 

Revised Bill (House 11 76) 23,823,582.30 

Decrease $90,408.05 

The following table shows what part of the budget 
bill remained unchanged, and what parts were increased 
or decreased, and their relation to the total involved : 



' 


Number of 
Items 


Amount 


Per Cent of 
Budget Bill 


Budget Bill 

Unchanged 

Decreased 

Increased 

Net Decrease 


491 

431 

18 

42 


$23,913,990.35 

23,629,299.58 

187,549.41 

97,141.36 

90,408.05 


100.00 
98.80 

•79 
.41 
•38 



From this it is clear that the budget bill of the joint 
special committee on finance and budget procedure was 
revised but slightly by the ways and means committee 
before submission to the legislature. After all had been 
said and done a net decrease of about a third of one per 
cent was made. 



1 1918 House Documents, 17, 1176; items 67I, 270, 280-285, 473-475-, 503, 



S04. 



I02 BUDGET IN MASSACHUSETTS 

The Revised Budget Bill Before the House. 

On January 25 the revised budget bill was reported 
to the house by Chairman Warner.^ Beginning on Janu- 
ary 28 two entire sessions and a considerable part of a 
third were devoted to the discussion of the budget bill. 
On the second day of the debate seven amendments 
were offered, all of them to eliminate or reduce items on 
the bill. Of these three, reducing the bill by $52,675, 
were rejected, and four, reducing the bill by $518,354, 
were adopted. On the following day three further amend- 
ments were put forward, one to cut out $4600 more, 
which was rejected, and two to restore $510,354 of the 
amount eliminated the previous day. As a result the bill 
went to the senate as it had been received, minus $8000.^ 

The $8000 eliminated by the house was composed of 
two items, the first appropriating $5500 for the main- 
tenance of the police steamer Lotis, and the second 
appropriating $2500 for examination of recruits of the 
state guard. It will be remembered that the questions 
of police steamers and the state guard were bones of 
contention, and that a number of items referring to the 
same matters had already been severed from the budget 
bill by the ways and means committee.^ 

During the discussion of the budget bill by the house, 
Mr. Warner, chairman of the house committee on ways 
and means, was continually on his feet answering ques- 
tions and explaining items. While the bill was still 

1 1918 House Journal, p. i66. ^ /^^.^ p. 174^ j^q^ 187, 

' 191 8 House Document 11 76, Items 270, 280-285. 



THE LEGISLATURE OF 1918 AND THE BUDGET 103 

before the house, Representative Young is reported as 
saying: "The general appropriation bill was discussed 
yesterday in the house during the whole session, and will 
be again to-day. For the first time in recent history, the 
Massachusetts legislature took a real interest in a financial 
measure, and the new system has more than justified 
itself already." 

The Btcdget Bill Before the Senate. 

The budget bill as passed by the house was received 
in the senate on February i and referred without dis- 
cussion to the senate committee on ways and means. ^ 
Here it was held for over a month. Senator C. L. Gifford, 
chairman of the committee, was none too friendly to the 
budget system, and as his service on the recess committee 
on taxation had precluded his appointment to the recess 
committee on the budget, he was entirely unfamiliar 
with the budget bill, and so demanded a careful working 
over of the entire measure. At this stage no public hear- 
ings were held, though a number of the department heads 
were given an opportunity to restate their cases. The 
change in commodity prices made it necessary also to 
reconsider the appropriations for some of the state insti- 
tutions. 

On March 5, Senator Gifford reported the bill with 18 
amendments. Seven of these made further reductions 
in the bill, while eleven provided increases. The total 
increases amounted to $48,042, while the decreases were 

^ 1918 Senate Journal, p. 168. 



I04 



BUDGET IN MASSACHUSETTS 



$2 1, 800, leaving a net increase of $26,242. It is especially 
interesting to note that over $39,000 of the increase is 
in institutional maintenance which the house ways and 
means committee had reduced.-^ 

On the following day, all of the amendments recom- 
mended by the senate committee were adopted in a block 
and without discussion.^ On March 11, when the bill 
was passed to be engrossed, three amendments were 
offered. The first made a decrease of $400 ; the second 
reintroduced an item of $1000 which had been cut out 
by the senate vote of March 6 ; and the third reintroduced 
an item of $5500 for the maintenance of the steamer 
Lotis which had been eliminated by the house. Of 
these amendments the first two failed, while the third 
was adopted on a roll call. The vote stood 18 to 14, with 
four paired, and three not voting.^ The vote by parties 
was as follows : 





Republicans 


Democrats 


Total 


Yes 

No 

Not voting .... 


15 
2 


5 
I 

I 


20 

16 

3 


Total 


32 


7 


39 



It mil be seen that there was no party issue involved. 

As a result of these 19 amendments adopted by the 
senate, the budget bill was increased by $23,742, or less 
than a tenth of one per cent of the total amount carried 
by the bill as it came to the senate. 

^ 1918 Senate Journal, p. 330. ^ Ibid,, p. 372. ^Ihid. 



THE LEGISLATURE OF 1918 AND THE BUDGET 105 

Senate Amendments Adopted by the House, 

On March 13 the amended budget bill was returned to 
the house and there referred to the committee on ways 
and means. ^ This committee recommended concurrence 
in all the senate's amendments.^ When the matter 
came up for vote on the 21st, there was no opposition 
except to the single item regarding the appropriation for 
the police steamer Lotis. The rejection of the senate's 
amendment however failed on a standing vote, 38 to 75, 
and the remaining amendments were adopted in a block 
without discussion.^ The bill then passed through its 
final stages and was laid before the governor and was 
signed by him on March 28 as Chapter 106 of the Special 
Acts of 1918.^ 

The Budget Bill as Passed Compared with the Original Bill. 
The budget bill as finally passed in Chapter 106 carries 
appropriation amounting to $27,488,488.39. While this 
is $2,991,498.04 above the budget bill as drawn by the 
recess committee on the budget, a careful analysis shows, 
after ehminating the non-comparable items as above, 
that the bill appropriates less than the original recom- 
mendation by only $66,666.05, or slightly over one quarter 
of one per cent. 

Significant Incidents in the Passage of the Budget Bill, 

There are five significant incidents in this brief story of 
the passage of the budget bill in 1918 : 

^ 1918 House Journal, p. 458. 2 jf,i^^^ p ^oo. 

^Ihid.y p. 534. 4 Ihid., p. 557 ; Senate Journal, p. 470. 



io6 BUDGET IN MASSACHUSETTS 

1. At no stage was a private motion made on the floor 
of either house to add a new item or to increase an exist- 
ing provision of the budget bill with the exception of three 
attempts to reintroduce items which had been cut out 
previously. 

2. There was no political division on the budget at 
any stage. 

3. There was practically no revision of the budget 
by the legislature itself. Neither house was interested 
in discussing more than half a dozen items, and the only 
individuals in the legislature who knew enough about the 
budget bill to criticise it were already responsible for its 
preparation. 

4. The only detailed examination which the budget 
bill had at the hands of the general court was in the ways 
and means committees. Each branch of the legislature 
accepted all the suggestions of its ways and means com- 
mittee, and the two houses came to an agreement on all 
matters without even a temporary deadlock or a confer- 
ence committee. 

5. The chairman of the house ways and means com- 
mittee was the chief proponent and defender of the budget 
bill. 

Disposition of Postponed Items, 

The budget items eliminated by the house ways and 
means committee were subsequently reported in two 
groups. Items 280 to 285, providing for the adjutant- 
general and the state guard, were reported on February 



THE LEGISLATURE OF 1918 AND THE BUDGET 107 

11.^ The ways and means recommendation showed a 
cut of $80,140 beyond the extensive cut aheady made 
by the recess committee. This recommendation of the 
ways and means committee was adopted both in the 
house and in the senate. In the house. alone was there 
any discussion of the measure. An effort to amend by 
making further radical decreases was defeated on a 
voice vote.^ Later in the session a number of minor 
amounts were allowed for the adjutant-general's depart- 
ment, bringing the total appropriation for his department 
up to $342,155.81.^ 

Item 270 of the 191 8 budget bill was never reported. 
The governor's special message advising the sale of the 
police steamer Lexington resulted in the passage of a 
law providing for the sale of the steamer.^ This made it 
unnecessary to pass an appropriation for its maintenance. 

Items 473, 474 and 475 were reported on March 14. 
The bill reported called for an appropriation of $180,000, 
the amount provided for in the tentative budget, in ac- 
cordance with the resolves of previous legislatures by 
virtue of which the grants were made.^ With the settle- 
ment of these questions, every matter raised in the tenta- 
tive budget bill was disposed of. 

Budget Recommendations for Capital Outlays. 

The joint special committee on finance and budget 
procedure was called on to sift over departmental requests 

^ House Journal, p. 246. ^ /^,^.^ p, 281 ; Special Acts of 1918, Ch. iii. 

^ 1919 House Document 200, p. 52. ^ Senate Journal, p. 392, 

^ House Journal, p. 472 ; Special Acts of 1918, Ch. no. 



io8 



BUDGET IN MASSACHUSETTS 



for capital outlays, totaling over $5,000,000.^ Of this 
amount, $270,000 was carried in the budget bill, and was 
enacted without revision. Excluding this $270,000, which 
was appropriated practically as a maintenance item, the 
following table indicates the requests, the budget recom- 
mendations, and the final action of the legislature : 

Budget Recommendations for Capital Outlays ^ 





Departmental 
Requests 


Budget 
Recommendation 


Appropriation 


Increase or 
Decrease 


Commission on 










Waterways 
and Public 










Lands . 
Other State 


S 2,4735141-69 


$400,000.00 


$1,778,342.00 


+ $1,378,342.00 


Departments 
and Institu- 










tions . . 


2,478,969.65 


1,172,833.89 


1,129,546.15 


-43,287.74 


Total . . . 


$4,952,111-34 


S 1,572,833.89 


$2,907,888.15 


+ $1,335,054-26 



From this table it will be seen that the budget recom- 
mendations for the commission on waterways and public 
lands were radically revised by the general court. The 
joint committee on metropolitan affairs to whom the 
recommendations of the commission on waterways and 
public lands was referred, reported in favor of the com- 
mission's plans for the improvement of the Port of Bos- 
ton. This was followed by a favorable report by the 
senate committee on ways and means, and then by a 
favorable report by the house committee on ways and 

^ House Document 17, pp. 12, 13, 65. 

2 Ihid.j p. 60-65 ; 1919 House Document 200 ; General and Special Acts of 
1918. 



THE LEGISLATURE OF 1918 AND THE BUDGET 109 

means. ^ While the final appropriation represents a 
marked difference of policy from that recommended in 
the tentative budget, it will be seen that the change of 
policy was approved by those who had drawn the budget. 
The recommendations of the tentative budget for the 
capital outlays of the remaining institutions and depart- 
ments was $1,172,833.89. This figure represented a 
cut of $1,306,135.76 from the departmental requests. 
The budget recommendation was in turn materially re- 
vised by the house ways and means committee and the 
legislature. The final appropriation omitted fourteen 
capital outlay items from the budget and added fourteen. 
The decreases totaled $186,856.00 and the increases, 
$143,568.26, leaving a net decrease of $43,287.74. The 
gross decrease was 15.8 per cent, the gross increase 12.2 per 
cent, and the net decrease 3.6 per cent of the total amount 
carried by the tentative budget. 

Relation of Budget Appropriation to Total Appropriations. 

The 1 91 8 budget failed to cover all of the needs of the 
commonwealth. The extent of this failure, as well as 
its causes, can be seen in the table on the following page. 

The recommendations of the governor were as vague 
as they could well be, though in many instances the 
amount he regarded as necessary was ^^ understood" by 
the leading members of the ways and means committee. 
The governor's recommendations had to do almost 
exclusively with emergency war matters, and were passed 

^ 1918 Bulletin No. 35, p. 26, 85 ; House Journal, p. 590, 601, 630. 



no 



BUDGET IN MASSACHUSETTS 



through the two houses under suspension of the rules in 
the main. 

Basis of 1918 Appropeiations 



Basis 



Budget 

Governor's messages 

Private petitions and departmental re- 
quests not submitted to budget com- 
mittee 

Supplemental maintenance requests of 
departments and institutions . . . . 

Estimates of metropolitan boards and 

commissions 

Total 



Appropriation 


Per Cent of 
Total 


$31,196,436.54 


80.7 


3,476,030.41 


9.0 


760,357.67 


2.0 


1,152,238.10 


3-0 


2,065,001.56 


5-3 


$38,650,064.37 


lOO.O 



The $760,357.67 appropriated on the basis of various 
petitions and requests also represents chiefly war emer- 
gency matters. At the same time there are included 
in this item appropriations for recess committees and for 
a very few other items that might be termed "private." 
Such items were, however, very successfully eliminated 
in 1 91 8. In the opinion of those who are in a position 
to know, this was due (i) to the budget procedure which 
forced the consideration of each matter in relation to the 
tax rate, and (2) to the war situation which made it possible 
to argue that road and harbor bills would not "help win 
the war. '^ At any rate they were all disposed of without 
serious difficulty. 

During the latter part of the legislative session, the 
increases in commodity costs began to be felt not only 
by the state institutions, but also by the lower-salaried 



THE LEGISLATURE OF 1918 AND THE BUDGET iii 

employees. As a result the departments and institutions 
requested substantial increases in the appropriations for 
their supplies and for salaries. In response to this appeal 
$1,152,238.19 was appropriated. 

It is to be noted that the 191 8 budget and the single 
maintenance appropriation bill based upon it covered in 
addition to the executive departments the legislative and 
the judicial departments as well.^ The estimates of 
these departments were revised and reported in the same 
manner that other requests were handled. The judicial 
department estimates came to $722,423.67, and the recess 
committee recommended aU but $3835.00 of this amount. 
Similarly $7300.00 was cut from the estimates for the 
legislative department, and both cuts were approved by 
the legislature as indicated in Chapter 106 of the Special 
Acts. 

The outstanding fact with regard to the appropriations 
of 1 91 8 is that the budget was the basis for but 81 per cent 
of the appropriations passed. This was due to the fact 
that other requests were received by the legislature direct 
from the governor and also from private individuals, 
members of the legislature and state officials. The re- 
quests in this last case represent chiefly estimates which 
according to law should have been filed with the regular 
departmental estimates. 

^ As had been recommended by the Joint Special Committee on Finance 
and Budget Procedure, Chapter i of 1918 (General) was enacted authorizing the 
treasurer to make advances during January and February to the members of the 
legislature for salaries and expenses at the rate provided by the appropriations 
of the previous year. (1918 House Document 17, Appendix.) 



112 BUDGET IN MASSACHUSETTS 

Appropriation Bills of igi8. 

During the session of 191 8, 22 appropriation acts were 
passed by the general court and signed by the governor. 
Of these 21 were classified by the secretary of the com- 
monwealth as "Special Acts'' and one as a "General 
Act. "^ This difference in classification was due to the 
fact that one of the acts contained not only an appropria- 
tion but also some other provision of general law. The 
practice of confusing appropriations by mixing them with 
general provisions of law has been steadily combated by 
the ways and means committee during the past few years. 
In 191 7, for example, there were eleven such acts. The 
total number of appropriation bills enacted also repre- 
sents a marked decrease.^ The number of appropriation 
acts passed during 1915, 1917, and 191 8 is as follows ; 

1915 1917 1918 

Appropriation acts passed 136 116 22 

The confusion of appropriations was lessened not only 
by a decrease in the number of bills, but also by the 
concentration of over 70 per cent of the total appropria- 
tions in a single act, based on the budget bill. The largest 
amount to appear in any single act during the previous 
decade was in the 191 7 act providing for the institutions 
administered by the commission on mental diseases. This 
bill carried some 12 per cent of the 191 7 appropriations.^ 
The concentration of appropriations in a single act brought 

^ Appropriation Acts of 1918 were : Special Acts, i, 17, 18, 27, 67, 95, 96, 97, 
106 (Budget Act), no, in, 140, 146, 148, 149, 161, 170, 177, 182, 186, 189; 
General Acts, 37. 

2 1917 House Document, 1185, p. 21. ' Special Acts 1917, Ch. 212. 



THE LEGISLATURE OF 1918 AND THE BUDGET 113 

about in 191 8 is the most complete since the heroic effort 
of 1858.1 

A marked improvement in the form of appropriation 
acts is also evident in 1918. The chief appropriation 
bill made a great step forward by placing the appropria- 
tions in semi-tabular form with the amounts appropriated 
at the right of the page in arable numerals. The following 
is a typical excerpt from the budget appropriation bill : 

Service of the Auditor of the Commonwealth 

For personal services of the auditor, office and other assistants, 
a sum not exceeding forty-eight thousand seven hundred fifty- 
dollars $48,750.00 

For service other than personal, travelling expenses, office supplies 
and equipment, a sum not exceeding five thousand dollars . . 5,000.00 
Total $53»75o-oo 

It will be observed that this is very far from being a 
"segregated budget. '^ In the case of offices divided by 
law or by practice into distinct bureaus the appropriations 
are generally further subdivided. The appropriations 
for the maintenance of institutions are each in a single 
lump sum. In fact the average item of the bill as a whole 
amounts to $46,000.00. There are 57 individual items 
running from $100,000 up, and four above one million 
dollars,^ 

In 191 7, and previous years, appropriations for office 
supplies and equipment and for miscellaneous expenses 
were made under the greatest variety of phrases. In 
1 91 7 for example there were no less than 34 distinct phrases 
used, each intended to cover the same authorization. 

* See page 34, ante, ^ Special Acts of 19 18, Ch. 106. 

I 



114 BUDGET IN MASSACHUSETTS 

The words "contingent/' "necessary," "sundry," "inci- 
dental," "current," "office," "general," and "other" all 
appeared singly and in a variety of combinations to 
qualify the word "expenses."^ This confusion was 
remedied by the 191 8 bill. 

Appropriations for the Metropolitan Districts, 

The 1 91 8 budget failed to include recommendations 
for the metropolitan districts. This material was delib- 
erately omitted because of the lack of time at the dis- 
posal of the joint special committee on finance and 
budget procedure. The appropriation for the metro- 
politan park commission and the metropolitan water 
and sewerage board, based upon the estimates of these 
two departments, amounted to $2,241,521.53. Of this 
sum $176,019.97, being the share of the expense borne 
by the state, was included in the appropriations based 
on the budget, while the balance, $2,065,001.56, was 
granted by chapter 67 of the Special Acts of 191 8 supple- 
mented by Special Act 182 and General Acts 157 and 177. 

Early Passage of Appropriation Acts. 

Massachusetts is distinguished from the great majority 
of states by the absence of the "last minute appropriation 
rush." This commendable distinction is not due entirely 
to the adoption of the budget system, though the experi- 
ence of 191 8 would lead to the conclusion that the budget 
system will help in securing early action on appropria- 
tion measures. 

* See especially Special Acts of 191 7, Ch. 374, 98, 37, 6. 



*l 



THE LEGISLATURE OF 1918 AND THE BUDGET 115 

The percentage of the total appropriations of the session 
enacted by periods during the 191 7 and 191 8 sessions, 
and for comparison recent figures for New York and for 
Ohio, are given below. 

Percentage of Total Appropriations Enacted Dxjring Specified 
Period of Legislative Session ^ 



Massachusetts 19 18 
Massachusetts 191 7 
New York iqi6 
Ohio 1915 



Per cent Enacted 

During First Half 

OF Session 



80 

67 

o 

o 



Per cent Enacted 

Before Last Week 

OF Session 



90.4 

93-3 

60 

190 



Per cent Enacted 

During Last Week 

OF Session 



9.6 

6.7 

94.0 

81.0 



While the figures presented in this table for New York 
and Ohio are not from the latest sessions, they represent 
substantially what happens from year to year in the 
average American state legislature. 

The increase of appropriations in Massachusetts dur- 
ing the last week of the 191 8 session over those of the 191 7 
session is due to the increases which a rising price market 
made necessary in the institutional and departmental 
appropriations and to an appropriation for $1,000,000 
for the pay of soldiers. In fact 191 8 appears in a more 
favorable light than 191 7 when these items are deducted. 

In comparing the Massachusetts "last week'' and "last 
day" appropriations with those of other states it is im- 

^ Massachusetts figures based on analysis of appropriation bills ; New York 
figures from Municipal Research Bulletin No. 72; Ohio from Mss. report by 
C. K. Matson. \ 

'$10,000. ^$33,115. 



Ii6 BUDGET IN MASSACHUSETTS 

portant to note that practically every dollar of the Massa- 
chusetts items represents appropriations made in accord- 
ance with resolutions passed earlier in the session specify- 
ing the amounts to be appropriated. Thus the figures 
for Massachusetts would be still further improved if the 
date of the resolution were substituted for the date of the 
appropriation. 

General Satisfaction with New Budget System, 

The first experience of the legislature with the new bud- 
get was universally satisfactory. Representative Young's 
remarks early in the session that "the new system has 
more than justified itself already" seems to have expressed 
the majority opinion. The best evidence of this is seen 
in the permanent establishment of the budget system dur- 
ing the same session of the legislature, as described in the 
following chapter. 



CHAPTER VII 

ESTABLISHING THE BUDGET SYSTEM 

I. The Budget System Bill 

Committee Recommendations. 

The budget system bill recommended by the joint 

special committee on finance and budget procedure 

provided as follows : ^ 

I. Preparation of the Estimates. 

a. Estimates for the "ordinary maintenance" of departments, 
institutions, and midertakings receiving annual appro- 
priations from the treasury of the commonwealth shall 
be prepared by the officer or board in charge and sub- 
mitted to the supervisor of administration by October 15. 
A copy goes to the auditor. These estimates "shall not 
include any estimate for any new or special purposes or 
objects not authorized by statutes." ^ 
I. Estimates for financial needs of departments, etc., not in- 
cluded above, including those to be financed by assess- 
ments or by bond issues, shall also be submitted by the 
department heads to the supervisor by October 15. 
No copy is required for the auditor. 

c. Estimates for revenues and other available funds shaU be 

prepared by the auditor and submitted to the supervisor 
and to the clerk of the house by December 26. 

d. Estimates of requirements for interest and debt service, 

for legally authorized claims against the state, and for 

^ House Document, 1918, 1185, p. 71. 

* The fiscal year in Massachusetts begins on December i. 

117 



Il8 BUDGET IN MASSACHUSETTS 

other such needs as are not covered by a and h above 
shall be submitted to the supervisor and to the clerk of 
the house by the auditor on or before December 26. 
e. A tabulated statement of the estimates submitted under a 
above, together with the comparative appropriations of 
the previous year and the expenditures for the three 
previous years shall be prepared by the auditor and sub- 
mitted to the supervisor and the clerk of the house by 
December 26. 

2. Revision of Estimates and Preparation of the Budget. 

a. The supervisor of administration shall revise all estimates 
and submit to the governor a budget *' setting forth such 
recommendations as the governor shall determine." 
No date is fixed for the completion of the supervisor's 
work. The supervisor is required to "make such in- 
vestigations as may be necessary." 

h. The governor may call upon the auditor for information 
and for assistance in the preparation of the budget.^ 

3. Submission of the Budget to the Legislature. 

"The budget shall be submitted by the governor to the 
general court not later than the second Wednesday in 
January of each year." ^ 

4. Content and Classification of the Budget. 

a. The budget shall contain "all estimates, requests and 
recommendations for appropriations or other authoriza- 
tions for expenditures from the treasury of the common- 
wealth." It shall also include "definite recommenda- 
tion of the governor as to the financing of the expendi- 
tures recommended and the relative amounts to be 
raised from ordinary revenue, direct taxes, or loans." 
With the budget the governor shall submit such mes- 
sages as he deems necessary. 

1 The bill provides for the appointment of a deputy to assist the auditor in 
this work. See page 119. 

2 The General Court assembles on the first Wednesday of January, Con- 
stitutional Amendments, Article X. 



ESTABLISHING THE BUDGET SYSTEM 119 

b, " The budget shall be classified and designated to show 
separately estimates and recommendations for : 

(a) expenses of administration, operation and maintenance, 

{h) deficiencies or overdrafts in appropriations of former 
years. 

{c) new construction, improvements, additions and other 
capital outlay. 

{d) interest on the public debt and sinking fund and serial 
bond requirements. 

(e) all new and other requests and proposals for expendi- 
tures." 

5. Appropriations. 

a. *'A11 appropriations based upon the budget to be paid 
from taxes or revenue shall be incorporated in a single 
bill to be designated the general appropriation bill." 

h. "Except on recommendation of the governor the general 
court shall not enact any other bill carrying an appropria- 
tion before final action on the general appropriation bill." 

6. Supplemental Budgets. 

The governor may submit, from time to time during the 
session of the general court, "supplemental messages or 
recommendations relative to appropriations, revenues and 
loans." 

Referred to Joint Ways and Means Committee. 

This bill was referred to the joint ways and means 
committee on February 28.^ No action was taken, 
however, until after the bulk of the appropriations had 
been disposed of. On May 10 the bill was reported 
to the house without a single alteration.^ Its passage 
through the house was uneventful, though on the third 
reading an amendment was adopted striking out three 

^ Senate Journal, p. 308. i 

^ House Journal, p. 787; House Document 1528. 



I20 BUDGET IN MASSACHUSETTS 

lines which authorized the auditor to "appoint a deputy 
in his department at an annual salary not to exceed thirty- 
five hundred dollars" whose duty was to furnish the 
governor any information necessary for his revision of 
the budget. It was asserted by Representative Martin 
Hays of Boston ^ that these three lines were intended to 
provide a "berth" for James W. Bean, chairman of the 
recess committee, who had failed of reelection to the 
senate. The amendment and the bill were adopted on 
voice votes, and the right of reconsideration cut off by 
the suspension of house rule 15 on motion of Representa- 
tive Hays. 2 

The bill with its amendment reached the senate May 
17.^ On its second reading, the amendment made in 
the house was struck out on motion of Senator Nichols, 
a member of the recess committee ; and on motion of 
Senator McLane, also a member of the recess committee, 
the following lines were eliminated: "Except on recom- 
mendation of the governor the general court shall not 
enact any other bill carrying an appropriation before 
final action on the general appropriation bill." Both of 
these changes were made on voice votes. ^ With these 
amendments, the bill passed through its remaining stages 
without comment. 

The house, after a brief debate, solely on the new posi- 
tion in the auditor's department, accepted the amend- 
ments made by the senate, and the bill was sent to the 

1 Mr. Hays was elected majority floor leader in 19 19. 

'^ House Journal, p. 813. ' Senate Journal, p. 695. *Ibid., p. 720, 



ESTABLISHING THE BUDGET SYSTEM 121 

governor for signature on May 27.^ The following 
day the bill was signed as chapter 244 of the General 
Acts of 1918.2 

Lack of Interest in Btidget System. 

The consideration of the budget system bill by the leg- 
islature emphasizes above everything the surprising lack 
of interest on the part of the people's representatives 
in the budget system. There was almost no discussion 
in either house concerning the fundamental features. 
The chief argument over the bill had to do with a specific 
job incidentally created in the auditor's department. 

Why the Bill Passed. 

In view of the total absence of recorded votes and of 
discussion of budget problems in the legislature, it is diffi- 
cult to analyze the situation and to classify the forces 
which brought about the passage of the budget system 
bill by the Massachusetts legislature of 191 8. An exami- 
nation of the situation, however, shows that the most im- 
portant reason for the passage of the bill was the fact 
that it came before the legislature with the unanimous 
and favorable report of the joint ways and means com- 
mittee. It thus had the backing of the financial leaders 
of the legislature and the tacit approval, at any rate, 
of the majority and minority party leaders of both houses. 
Under these circumstances, it is not uncommon for meas- 
ures to "slide through" without so much as a rising vote. 

^ Senate Journal, p. 761 ; House Journal, p. 866. 

2 James W. Bean was appointed by the auditor to fill the position created by 
the biU. 



122 BUDGET IN MASSACHUSETTS 

This is what happened in the case of the budget bill. 
The experience with the budget earlier in the session had 
been satisfactory ; consequently no one opposed the budget 
system bill seriously. The changes that it contemplated 
stepped on nobody's toes, except the deputy auditor's, 
and a small and influential group thus found it possible 
to secure the acquiescence of the remaining leaders of the 
legislature, and the favorable action by the two houses. 

Those who believed in the budget system were aided 
powerfully by the budget propaganda of the previous 
few years, and by the high tax rate. The term "budget" 
had been made almost synon)niious with efficiency, econ- 
omy and lower taxes. Then, too, the constitutional 
convention was almost sure to pass a budget amendment, 
and if the legislature could act first, it would deserve the 
credit for leading the way, and might even prevent the 
passage of a budget system by the convention which might 
vest in the governor powers now belonging to the legisla- 
ture. The influence of the office of the supervisor of 
administration was in favor of the adoption of the bill. 
This unquestionably served to allay the suspicions of 
many, as both Mr. White and Mr. Raymond had been at 
the state house for many years. 

II. Other Financial Reforms in 191 8 

In addition to the major reforms, the 1918 general 
court enacted a number of acts which deserve mention 
because of their part in laying the foundation for an effec- 
tive state budget system. 



ESTABLISHING THE BUDGET SYSTEM 



123 



Minor Recommendations of the Joint Special Committee 
on Finance and Budget Procedure. 
Excluding the tentative 191 8 budget and the budget 
system bill, the joint special committee on finance and 
budget procedure made 19 specific recommendations 
for the enactment of new laws or the revision of existing 
laws. In view of the customary failure of recess commit- 
tees to produce any tangible fruits as the results of their 
labors, it is interesting that this recess committee can 
point to a remarkable record of achievement. Of the 
19 recommendations, 14 had been written into the laws 
of the commonwealth by the end of the 191 8 session, and 
two others were carried through in 1919.^ In the majority 

^ The following is the list of the Recommendations of the Joint Special Com- 
mittee on Finance and Budget Procedure, with their disposition. 



Recess Report 


Legislative Report 


Disposition 


House Doc. 17 


House Doc 


.3 


19 1 8 General Ch. i 




« « 


1 164 


" Ch.io 




« (( 


1165 


" Ch. 8 




<( « 


1166 


"f " Ch. 16 




« (( 


119s 


Ch. 151 




tt u 


1176 


Special Acts Ch. 106 (Bud- 
get App.) 


House Doc. 11 85 


C( (( 


1413 


General Acts Ch. 202 




tt It 


1434 


" Ch. 189 




ft C( 


1436 


" Ch. 175 




ft (( 


1478 


" Ch. 290 




tt (( 


IS" 


" Ch. 217 




tt It 


1512 


" Ch. 221 




tt (t 


1545 


" Ch. 239 




tt (I 


1528 


" Ch. 244 (Bud- 
get System) 




U tt 


ISS4 


" Ch. 283 




tt et 


1555 


" Ch. 268 




Motor Vehicle Fees 


Next General Court. 




Land Court Fees 


No legislation necessary- 




Legislative Manual 


No legislation necessary 




Consolidation of Depts. 


Ch. 350, 19 19 Gen. 




Judicature 


Commission 


Ch. 23, 1919 Gen. 



124 BUDGET IN MASSACHUSETTS 

of these cases, the bills as drawn by the recess committee 
were enacted without amendment. 

Among this group of acts there are four that merit 
special notice here. Chapters 175 and 189 of the General 
Acts of 1 91 8 increase the control of the supervisor of 
administration over departmental printing. Under Chap- 
ter 296 of the General Acts of 191 6 the supervisor already 
had power to examine and revise the annual reports of 
state departments. This power was materially extended 
by the two 191 8 acts cited, by requiring that the super- 
visor shall determine the number of annual reports to be 
published by each department, and that "case books 
and technical reports" shall not be distributed free 
except to a limited group of state officials. In the super- 
visor was vested the power to determine when reports 
fell within this group. These acts have made it possible 
to cut down the appropriations for departmental printing. 
They have also resulted in establishing an elastic adminis- 
trative control of departmental expenditures for printing.^ 

The third act of importance is Chapter 221 of the 
General Acts of 191 8. Up until 191 8 the armory com- 
mission was authorized to spend such sums as it found 
necessary, including capital outlays for new armories, 
and to raise the necessary funds by the issuance of bonds.^ 
This entire process was removed from any control by the 
legislature, though the general court was subsequently 

1 Annual Report Supervisor of Administration, 1919, P. D. 119, p. 19. 

2 Acts of 1908, Ch. 604, Sec. 133, as amended 1909, 1912, 1913 and 1917. 
To November 30, 1918, the expenses of the commission were $5,225,100. (1919 
House Doc. 500.) 



ESTABLISHING THE BUDGET SYSTEM 125 

required to appropriate funds to pay the interest and to 
retire the bonds. Chapter 221 remedied this situation 
by requiring the armory commission to submit annual 
estimates like any other department, and to expend only 
such sums as are appropriated for its use either from the 
general fund or from the issuance of bonds when specifi- 
cally authorized by the legislature. 

The fourth act is Chapter 290 of the General Acts. 
It provides that estimates for new construction or for 
alterations in permanent structures costing over $5000, 
including heating, plumbing, lighting and ventilating, 
shall be accompanied by preliminary studies and general 
specifications sufficient for a careful estimate by a com- 
petent contractor, and by at least one such estimate of 
the costs involved. This information must be submitted 
to the supervisor of administration by October 15 as a 
basis for his budget recommendations to the governor as 
required by Chapter 244. This act replaced and amended 
Chapter 520 of 1907. Its importance here is that the 
detailed information required is to be submitted to the 
supervisor along with all other departmental requests. 

Salary Standardization and the Administrative Control of 
Appointments and Promotions. 

Next to the establishment of the budget system, the 
most far-reaching administrative reform of 1918 was the 
enactment of Chapter 228 of the General Laws directing 
the supervisor of administration to classify ''in ser\'ices, 
groups and grades according to the duties pertaining to 



126 BUDGET IN MASSACHUSETTS 

each office or position" . . . "all appointive offices and 
positions in the government of the commonwealth, except 
those in the judicial and legislative branches. " ^ This 
act also provides that the supervisor shall make rules and 
regulations, with the approval of the governor and council, 
for the "application and administration of the classifica- 
tion and the specifications established.'^ ^ In order to 
simplify the budgetary problem, it is provided that no 
salary increase shall take effect prior to June first of the 
year for which it is approved. 

In accordance with the rather general provisions of this 
law the supervisor, with the approval of the governor 
and council, has issued a very definite set of rules and 
regulations, together with an extensive classification of 
the appointive positions in the state government and the 
salary grades within each group. In accordance with 
these rules and specifications, the supervisor's ap- 
proval must precede the appointment of state employees, 
all salary increases, and all transfers and promotions. 

Section three of Chapter 228 links the salary 
standardization up with the new budget system by 
providing : 

"No salary attached to an office or position classified in 
accordance with the provisions of this act shall be increased 
by a department head unless an appropriation sufficient to 
cover such increase has been granted by the general court in 
pursuance of a specific recommendation in the estimates 
filed as required by law." 

^ General Acts of 191 8, Ch. 228, sec. i. ' Ibid., sec. 2, 



ESTABLISfflNG THE BUDGET SYSTEM 127 

Administrative Control of Transfers of Funds Appropriated 
for State Departments. 

It has been pointed out that the Massachusetts appro- 
priation acts contain as a rule lump sum grants. These 
are based upon the detailed estimates of the departments, 
and while there is no legal restriction, it has been an un- 
derstanding that the lump sums appropriated are to be 
expended in accordance with the detailed estimates pre- 
sented by the departments to the ways and means com- 
mittees. The existence of this practice was recognized, 
and any "transfer" of funds from one estimate item to 
another in the future was placed under the control of the 
auditor by Chapter 38 of the General Acts of 191 8. This 
act provides : 

" No transfer of funds from one item of account to another 
on the books of any ofl&cer or board having charge of any 
department, institution or undertaking receiving an annual 
appropriation from the treasury of the commonwealth, upon 
which items of account such annual appropriation is based, 
shall be made without the written approval of the auditor of 
the commonwealth." 

"Transfer " in this act does not refer to transfers between 
appropriation items, but solely to transfers within an 
appropriation item from one estimate item to another. 
These subitems are not presented or referred to in the 
appropriations themselves. Genuine transfers from one 
appropriation to another are illegal in Massachusetts 
except from the emergency appropriation of the executive 
department.^ 

1 See page 36. 



128 BUDGET IN MASSACHUSETTS 

While the purpose of this law is to simplify the work 
of the auditor in keeping track of the appropriation ac- 
counts, its importance from a budgetary and control 
standpoint is clear. 



CHAPTER VIII 

THE CONSTITUTIONAL CONVENTION AND THE 
BUDGET 

During the summers of 191 7 and 191 8 the question 
of a state budget was before the Massachusetts constitu- 
tional convention. At the first session, however, the 
budget resolutions received no consideration in the con- 
vention itself for lack of time. The various resolutions 
submitted received the careful attention of the committee 
on finance appointed by the convention for this purpose 
in July, 191 7. 

Between the first session of the constitutional conven- 
tion and the second, the legislature established a state 
budget system by statute, as we have seen in the preced- 
ing chapter. While this action by the legislature admit- 
tedly provided a budget system satisfactory, as far as 
it went, to the convention,^ it was recognized that the 
legislature could not prevent future legislatures from 
repealing the budget act, nor could it give the governor 
the power to veto items. To accomplish these ends, a 
constitutional amendment was necessary. 

I. The First Session of the Convention, 191 7 

The Budget Resolutions Submitted, 

Four separate resolutions were offered in the constitu- 
tional convention providing for a budget amendment 

* See page 151. 
K 129 



I30 BUDGET IN MASSACHUSETTS 

to the constitution. The first of these followed closely 
the budget provision of the rejected New York constitu- 
tion of 191 5, with the important exception that there 
was to be a state budget committee composed of the 
governor, the auditor and three appointees of the 
governor.^ It was provided that the committee should 
prepare a budget on the basis of departmental estimates 
and hearings to be submitted to the legislature by the 
governor, who was to have the right to appear and defend 
his budget. The power of the legislature was limited to 
the elimination or reduction of items except in the judicial 
and legislative appropriations. 

A second resolution ^ required the governor to sub- 
mit a budget which the legislature might increase 
or decrease, and required the passage of a single ap- 
propriation measure. Additional appropriations were 
allowed only on the recommendation of the governor or 
by single item bills passed on roll call by a two-thirds 
vote. The governor was also given the power to decrease 
or veto items. 

The Maryland budget amendment was copied almost 
word for word in the third resolution referred to the com- 
mittee.^ It provided for a governor's budget, a single 
appropriation bill, the participation of the executive in 
legislative debates on the budget, the restriction of the 
legislature to the decrease of items only, and single-item 
supplementary appropriations, each providing its own 

1 Convention Document No. 57, Cf. Article V, N. Y. constitution, 1915. 
^Ibid., No. 275. ^Ibid., No. 276. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 131 

revenue and to be passed only on a roll call and by a ma- 
jority of the members elected. 

These three resolutions were presented to the conven- 
tion by Messrs. Ralph L. Theller, James M. Codman Jr., 
and Raymond P. Bellinger, respectively, all of whom 
were appointed members of the finance committee. 

A fourth resolution, drawn by Dr. Frederick A. Cleve- 
land, and presented by Mr. George F. Willett, represents 
the most thoroughly worked out executive budget amend- 
ment presented before any recent constitutional con- 
vention. It is therefore presented here in full. 

Governor to Submit Estimate to Legislature. 

The governor shall communicate at every session of the 
general court the condition of the state and recommend such 
measures as he may judge expedient. Not later than the first 
week of the regular session of the general court, the governor 
shaU submit to the general court the estimates of expenditures 
supported by such collateral data as are required to show the 
financial needs of the departments under his jurisdiction. 

Governor to Appear and Explain Estimates. 

The governor either personally or by official representation 
designated by him shall meet with the general court in joint 
session on such days as shall be appointed for this purpose 
not less frequently than twice a week to explain, discuss 
and defend such estimates. 

Committee of the Whole Procedure on Estimates. 

Upon receiving the estimates the general court shall resolve 
itself into a committee of the whole house in joint session not 
less frequently than two days each week, at which time the 
governor and the executive heads under him may have the 
privilege of the floor to explain the estimates and items of 



132 BUDGET IN MASSACHUSETTS 

appropriations requested, and to answer such questions as 
may be raised with respect to proposed items and proposed 
conditions to be attached to appropriations, which sessions 
or meetings of the general court shall be public. 

Separate Votes for Each Organization Unit. 

When so sitting, votes shall be taken in the committee of 
the whole house on the amount requested for each department, 
bureau, or commission, separately. 

Members May Propose Reductions Only. 

No amendment to an administrative appropriation bill or 
item may be offered by any member of either house except to 
reduce the amount thereof. 

Governor to Submit Budget to Legislature. 

Not later than six weeks after the beginning of the regular 
session the governor shall submit to the house of representa- 
tives a summary financial plan or budget with an appropria- 
tion bill and such revenue and other financial bills as in his 
opinion may be required, and a copy of said budget and bills 
shall also be sent to the senate. 

Form and Content of Budget. 

The said budget shall contain summary statements setting 
forth : 

Actual and estimated revenues and expenditures for a period 
beginning not less than two years prior to the period to be 
financed ; 

The present assets, liabilities, surplus and deficit and the 
estimated financial condition of the state as of the beginning 
and the end of the period to be financed ; and 

The present condition of appropriations and funds and the 
estimated condition of appropriations and funds as of the 
beginning and the end of the period to be financed. 

With said budget shall be submitted a message in support 
of bills or measures explaining the administrative financial 
proposals. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 133 

Committee-of-the-Whole Procedure on the Budget. 

Upon receiving from the governor the annual budget with 
his finance bills and any amendments which the governor may 
propose, each house shall resolve itseK into a committee of the 
whole for the purpose of initially considering administrative 
appropriations, revenue and borrowing bills. 

Governor's Measures to Have Priority, 

When administration bills for the appropriating or raising 
of money shall be reported from the committee of the whole 
house, they shaU take precedence over all other matters. 

Other Proposals as Separate Bills Only. 

No new subject or item shall be appropriated for except by 
separate bill which may be independently vetoed by the 
governor. 

Referendum in Case of Deadlock. 

In case the general court is unable to agree on an adminis- 
trative appropriation bill submitted by the governor, either 
the general court or the governor may call an election for the 
submission of the issue to the people, at which election, both 
the general court and the governor shall stand for reelection, 
and in any event new nominations may be made in the same 
and under the same conditions as for other reelections.^ 

Hearings before the Committee on Finance, 

The committee on finance of the constitutional con- 
vention held its hearings on the budget from July 5, 
through July 11, 1917.^ During this time there appeared 
before the committee : Nathan Matthews, Harvey S. 
Chase, Frederick A. Cleveland, Thomas W. White, A. 
Lawrence Lowell, Charles E. Burbank, Joseph Walker, 

^ Convention Document 277, 

2 Journal of Committee on Finance, p. 4, 19, 



134 BUDGET IN MASSACHUSETTS 

Benjamin Loring Young, Joseph E. Warner, James W. 
Bean, Francis X. Tyrrell, and David I. Walsh. Governor 
McCall, who was informed "That the committee would 
be pleased to hear his views upon the budget," did not 
appear.^ 

Of these twelve men, ten were in favor of a governor's 
budget, one was on the fence, and one opposed; nine 
believed in allowing the governor to defend his budget 
in the legislature; five were for limiting the legislature 
to the decrease of items only, and no one expressed 
himself as opposed to the governor's veto or reduction 
of items, though several did not discuss the point.^ 

The testimony of A. Lawrence Lowell, following that 
of Frederick A. Cleveland, is especially interesting. Dr. 
Cleveland had argued in support of his simon pure execu- 
tive budget patterned after the English system. He 
made it perfectly clear, however, that a thorough reor- 
ganization of the executive departments was a prerequisite 
to the introduction of an executive budget.^ He believed 
that such a reorganization coupled with an executive 
budget and the provision for an appeal to the people in 
case of a deadlock would produce responsible govern- 
ment in Massachusetts. 

Dr. Lowell introduced his remarks by a brief historical 
sketch of American financial administration, laying special 
emphasis on its British origins, and its fundamental 
reform as the result of the establishment of a popularly 

* Journal of Committee on Finance, p. ii. 

2 Ihid., p. 4 to ig. ^ /j^^^ p^ g^ 7, 



CONSTITUTIONAL CONVENTION AND THE BUDGET 135 

elected governor. As the result of this fundamental 
difference, he concluded : " The EngHsh system and ours 
are not the same and cannot be run in the same way. 
We cannot put into practice the same initiative of legis- 
lation which the English have." ^ 

Dr. Lowell then argued for the adoption of a budget 
system in harmony with American institutions. He 
believed that the governor who is elected by all the people 
is in a better position to prepare a budget than the legis- 
lature or a budget committee. He felt it necessary and 
imobjectionable to have the routine work on the budget 
done by a permanent staff agency, but made it clear that 
this should be revised by the governor and submitted 
to the legislature as his budget. Dr. Lowell argued that 
it is "against the essence of the budget system" to allow 
the legislature to increase items. He recogjiized, however, 
that there should be an "outlet" for private petitions 
and members' bills, and while he did not commit himself, 
he appeared to favor the Maryland restriction.^ This 
testimony of Dr. Lowell's follows in all essentials his 
opinions expressed before the committee on finance of 
the New York constitutional convention in 1915,^ 
though at that time he said, in reply to a question on 
ways of eliminating a deadlock between the governor 
and legislature : 

"I could invent various ways of getting rid of that. Of 
course, if worse came to worse, we would have a reelection 

* Journal of Committee on Finance, p. 8. ^ /^.^ p, q. 

3 Bureau of Municipal Research Bull. No. 62,'"p. 393 ff. 



136 BUDGET IN MASSACHUSETTS 

of either the Governor or the House, if the term ran for some 
time. You could provide a certain minimum of expenditures 
in some way ; but if you shake the people up in a box they 
would generally agree, because neither party would want to 
keep the State of New York without expenditures." ^ 

Report of Finance Committee. 

After some discussion of the four suggested budget 
amendments in the light of the testimony, the committee 
on finance of the Massachusetts constitutional conven- 
tion decided unanimously that the budget amendment 
"should be general in form and that detailed procedure 
be left to legislation." ^ In conformity with this decision 
a committee of three was appointed to draft a new amend- 
ment following the general lines of Mr. Codman's reso- 
lution.^ An attempt to instruct the subcommittee to 
limit the power of the legislature to the reduction or 
elimination of items failed after ^ lengthy discussion."^ 

The subcommittee reported a resolution of but thirty- 
nine hnes providing for : 

1. The deposit of all receipts of the commonwealth 
in the treasury, and the expenditure of moneys solely 
in accordance with specific appropriations. 

2. The governor's submission of a budget at the begin- 
ning of the legislative session and supplemental budgets 
later, if necessary. 

3. The participation of the governor or his representa- 
tives in budget debates. 

* Bureau of Municipal Research Bull. No. 62, p. 421. ^ journal, p. 12. 
^ Ibid., p. 12, 13. Messrs. Parkman, McCaffrey and Theller formed the 
subconunittee * Journal, p. 12. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 137 

4. A single appropriation bill with precedence over all 
other appropriation bills. 

5. The right of the legislature to increase or decrease 
items. 

6. The limitation of appropriation bills not recom- 
mended by the governor by requiring for passage a ma- 
jority vote on roll call of all the members of each chamber 
and a provision of revenues in each bill to meet the ex- 
pense involved. 

7. The veto or reduction of appropriation items by the 
governor. 

This report of the subcommittee was discussed at 
length on July 12, when a number of minor verbal changes 
and rearrangements were made. The participation of 
the governor in legislative debate on the budget was 
taken for granted. An attempt to exclude subordinate 
executive officers on the grounds of "lack of dignity in 
proceedings which might result" failed by a three to eleven 
vote.^ The only serious difference of opinion arose on 
the provision allowing the legislature to increase items 
in the budget. After a "long discussion participated 
in by every member" it was decided seven to five to adopt 
the provision as it stood.^ 

Because of the relation between the budget and the 
reorganization of the executive departments, the com- 
mittee on finance decided to secure the informal opinion 

^ Journal, p. 21. 

^Ibid. Dissenting: Ferry, Lowe, Dellinger, Theller and Finn. Absent: 
Hoit and Putnam. Presiding: Parkman. Hoit and Parkman agreed with 
the majority (Journal, p. 24). Putnam was absent throughout. 



138 BUDGET IN MASSACHUSETTS 

of the committees on state administration and on the 
executive on its tentative draft of the budget amendment. 
This action was taken in place of a suggested joint effort 
by these committees on executive and budget matters 
because of the "disadvantages to be expected from entan- 
ghng the work of this committee [committee on finance] 
with the more contentious subjects before the other 
committees [state administration and executive]." ^ The 
budget amendment "met the general hearty approval" 
of the other committees, however, and was finally and 
formally adopted on July 16 with five members dis- 
senting on the clause which left with the legislature the 
power to increase items, and one "reserving his rights" 
on the requirement of a special majority for the passage 
of private appropriation bills.^ 

II. The Second Session of the Constitutional 
Convention 1918 

Committee Report before the Convention. 

The committee on finance of the constitutional con- 
vention completed its amendment on July 17, 1917.^ 
It was not till July 10, 191 8, however, that the amend- 
ment was given its second reading. At this stage five 
amendments were moved. Two of these were textual, 
a third extended the last date for the presentation of the 
budget from three weeks to two months after the conven- 
ing of the legislature, a fourth made provision for a 

^ Journal, p. 21. ^ Ibid., p. 24. 

^ Convention Doc. No. 325, Con v. Journal, p. 99. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 139 

" vote on account" pending the passage of budget appro- 
priations, and a fifth, by Mr. Bellinger, limited the power 
of the legislature solely to decreasing or omitting items 
in the governor's budget.^ 

The vote on these amendments came up on the following 
day after a protracted session on the compulsory voting 
amendment during which two rolls were called. As a 
result of efforts by the committee on finance, all amend- 
ments were withdrawn with the exception of that extend- 
ing the last date for the presentation of the budget, which 
was rejected 19 to 82 ; and one of the committee's textual 
changes, which was adopted.^ With this single inconse- 
quential change the amendment was passed, and ordered 
to a third reading. At this stage there was very little 
interest evinced. Half of the convention delegates pres- 
ent left their seats for the lobby as soon as the compulsory 
voting fight was over and the budget amendment taken 
up.^ 

Debate on the Executive. 

Between the second and the third readings of the bud- 
get amendment a protracted and bitter debate on the 
executive took place. This debate and the votes taken 
at the time have an important bearing on the subsequent 
consideration of the budget amendment and therefore 
deserve consideration as a part of the debate on the 
budget. 

* Convention Journal, p. 752, 753. 2 /j/j,^ p. 760. 

^Ibid., p. 759. 222 voted on the compulsory voting amendment, and but 
loi on the budget. 



I40 BUDGET IN MASSACHUSETTS 

Recommendations of Committee on the Executive, 

In making its report, the committee of the constitu- 
tional convention on the executive stated that : 

"The primary purpose of the amendments now reported 
is to integrate our state government as an organic whole and 
to introduce effective responsibility into all its workings, — 
responsibility to the governor so far as honest and eflScient 
administration is concerned, responsibility to the legislature 
in respect to observance of the laws which it passes and the 
proper expenditure of the public money which it appropriates.'' ^ 

This required that the governor be the head of the 
administration and that his "advisory but potent influ- 
ence in shaping legislation" be recognized constitution- 
ally. For, in the words of the committee : 

"However faithfully and ably a legislative body may perform 
its duties, it cannot supply the element of political leadership, 
of responsible initiative; its very numbers, its very method 
of election by a large number of constituencies, prevent this. 
The executive alone represents the whole body of the people 
because he alone is elected by and is responsible to them; 
in state government it is therefore chiefly to the governor 
that the people look for improvements or reforms, whether 
these are to be secured by administrative or by legislative 
means. They expect him to put forward and to push to success 
legislative policies of his own, — not merely to content him- 
self with ceremonial and supervisory duties. 

"This tendency in our political development now calls 
for corresponding constitutional changes, particularly needed 
in this state, in order that through formal recognition this 
newer function of the executive may be made more effective 
for good and at the same time subject to greater publicity and 

1 Convention Doc. 311, p. 10. 




CONSTITUTIONAL CONVENTION AND THE BUDGET 141 

responsibility. If the governor is to be in fact a leader of 
political thought, an initiator of progressive measures, or even 
an authoritative party leader, it is certainly desirable to recog- 
nize these conditions and to provide more fully for the powers 
and responsibilities which should accompany such a develop- 
ment of the executive function. 

^'This can best be accomplished by giving formal recognition 
to the extra constitutional relations between the executive 
and legislative departments which now exist to so considerable 
an extent in fact.'^ ^ 

The specific amendments recommended ^ by the com- 
mittee were : 

1. All state ofl&cers and employees not in the judicial 
or legislative departments "shall be under the authority 
and control of the governor, and all such officers without 
exception shall furnish him with any official report, in- 
formation or opinion which he may require." 

2. The governor may remove for cause after notice 
and hearing any officer subject to his appointment. 

3. The term of office of the governor and lieutenant 
governor shall be two years. 

4. The governor shall dehver a message to the legisla- 
ture at the beginning of each regular session and at any 
other time, and " so far as practicable he shall accompany 
any specific recommendations with drafts of bills. ' ' These 
are to be known as "executive bills," and must be reported 
on by legislative committees within thirty days, and 
given precedence in the legislature, and can only be re- 
jected on a roll call. 

1 Convention Doc. 311, p. 12, 13. ^ Ibid., No. 311. 



142 BUDGET IN MASSACHUSETTS 

5. In case the legislature refuses to pass or amends an 
"executive bill," the governor may submit it to the 
people at the next state election. Similarly, bills passed 
over the governor's veto may be submitted to the people 
by the governor provided he takes the necessary action 
within thirty days to secure the submission. If vetoed 
bills fail of subsequent passage over the veto the measure 
may be submitted to the people by a majority vote in 
the legislature. 

6. "The governor may at any time attend a session 
of either branch of the general court and speak upon any 
pending bill. Upon the written request of the governor 
any executive or administrative officer shall be admitted 
temporarily to a seat in either branch of the general 
court with the right to speak upon any matter coming 
within or under his official authority, but without a right 
to vote ; and upon the request of either branch made to 
the governor any such officer shall appear in person be- 
fore it." 

7. The governor may return to the legislatiure any bill 
laid before him for signature with the recommendation 
that it be amended by the adoption of specific changes. 
Such an amendment can be rejected only on a roll call. 
The governor may also amend bills by striking out por- 
tions, which can be replaced only by a two-thirds vote. 

8. The succession of officers, in case of the death, ab- 
sence or incapacity of the governor and lieutenant gov- 
ernor shall be: secretary, attorney-general, treasurer, 
and auditor. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 143 

The committee took special care to point out in its 
statement in support of the amendments that these recom- 
mendations should be considered with the budget amend- 
ment, for "state finance in its broad aspects, and the 
estabhshment of a budget system, are certainly related 
very closely to the position of the chief executive in the 
government of the state and the authority which is to 
be vested in his ojS&ce." ^ 

Debate in the Convention, 

The convention took up these recommendations in 
logical rather than numerical order.^ As a result the 
second matter to be discussed, and the one which interests 
us most directly, was the amendment authorizing the 
governor and his subordinates to appear in the legislature 
and to take part in debate. 

The discussion was opened by Josiah Quincy, chairman 
of the committee on the executive. He summarized 
what he had to say in the sentence, "The whole object 
is to bring these two branches of government, which now 
operate very often too much at arm's length, with too 
little understanding on the part of each of the position 
of the other, into closer relations." ^ On the specific 
question of the appearance of the executive to discuss 
measures in the legislature he said : 

"The personal appearance of the man who backs up the 
proposal wUl, to my mind, tend, without bringing either au- 
thority under the domination of the other, to bring these two 

* Convention Doc. 311, p. 8, 9. 2 Convention Debates, Vol. 97, p. 92. 

^ Ihid.y p. 106. 



144 BUDGET IN MASSACHUSETTS 

authorities, legislative and executive, into more efficient work- 
ing relations with each other." ^ 

Martin Lomasney, the well-known leader of a faction 
of the Boston Democrats, led the attack on the proposed 
amendments. He was ready at all times to interpose 
critical questions, and to call up concrete instances of 
friction between the governor and the legislature. The 
following excerpts indicate his position : 

"This scheme is one to put into the hands of one man, 
who may not belong to any party, the power to interfere in 
this powerful and dangerous way with the workings of the 
legislative department. It is a scheme, it seems to me, to 
put a premium upon demagogues in the governor's chair. . . ," ^ 

"I suggest that this proposal will create in this state for the 
first time under our constitution party government inside these 
legislative walls after the members have left party government 
behind on inauguration day when they took their oath of office. 
And that is one of the worst features of the bill. ... A 
governor reaches members of the legislature who are of his 
own party and he often appeals to them to assist him because 
it might affect his political fortunes in the fall. And you are 
now starting to put that partisanship into the constitution. 

"I do not believe in having our governor the recognized 
party leader in the legislature, so that everything that is done 
there shall be done with the idea in mind of what effect it will 
have on his political fortunes." ^ 

In view of Mr. Lomasney's position that the right of 
the executive to debate measures in the legislature ''will 
create in this state, for the first time since the constitu- 
tion, party government," the remarks of Mr. Kinney 

1 Convention Debates, Vol. 97, p. no. * Ibid., p. 174. 

^ Ibid., p. 120, 122. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 145 

deserve attention. Mr. Kinney opposed the amendment 
because "policies should not emanate from the governor, 
but from the people.'' ^ He said further: 

" I believe in party government . . . and it is this tendency 
to get away from party government, the tendency in this bill 
to permit the executive, after he has once been elected, to 
force his own individual policies on to the commonwealth, 
if possible, which I believe would ultimately destroy de- 
mocracy." ^ 

"This bill will be destructive of party government. In case 
this bill becomes operative you will encourage executives to 
leave their party principles and to formulate individual poli- 
cies." ^ 

" If you are going to put into effect the system of government 
this bill is permeated with in every line, you are going to 
destroy legislative government, representative government, 
and substitute for it an elective autocracy, which to my mind 
is absolutely destructive of the fundamental principles of 
democracy." ^ 

The voices raised in favor of the amendment were few 
and unimpassioned. Mr. James A. Lowell alone openly 
attacked the sacred ''separation of powers." He not only 
criticised it as unworkable, but maintained that it was 
practically non-existent. He regarded the amendment as 
necessary to make the governor a real political figure. 
He added, 

"If we give to the governor this authority, and more I hope, 
we shall make the office open and attractive to the leading 
spirits of the state anxious for a political career." * 

^ Convention Debates, Vol. 97, p. 140. 2 /j^,^ p, j^^ 

3 Ibid,j p. 155. 4 Ibid., p. 148. » Ibid,, p. 137. ■ 

L 



146 BUDGET IN MASSACHUSETTS 

Amendments Voted Down. 

The vote on the amendment authorizing the executive 
to appear in the legislature showed but a handful in its 
favor. On a standing vote 37 voted in its favor and 124 
against.^ The convention was clearly opposed to giving 
up the time-honored mask of "separation of powers.'' 

The general attitude of the delegates toward the 
governor is also indicated in their defeat of every other 
amendment reported by the committee on the executive, 
except the two providing for the succession of office and 
the return of bills by the governor with recommendations, 
from which the clause requiring a roll call in case of the 
rejection of the governor's amendment was eliminated.^ 
The program of the committee on the executive was 
completely rejected in spite of the fact that it was the 
unanimous report of a group of men who had to their 
credit not only service in the executive department, but 
also nineteen years in the legislature.^ 

Committee on Finance Changes Its Mind, 

As a result of the discussion of the budget amendment 
on its second reading and as a result of further reflection, 
the committee on finance presented two important amend- 
ments when the budget amendment came up for a third 
reading on August i, 1918. These made the following 
changes : 

1 Convention Debates, Vol. 97, p. 187. 

2 Amendments passed by Constitutional Convention, p. 11, 13. 
' Convention Debates Vol. 97, p. 97. 



Ji 



CONSTITUTIONAL CONVENTION AND THE BUDGET 147 

1. The requirement that all funds " received on account 
of the commonwealth from any source whatsoever shall 
be paid into the treasury of the commonwealth and no 
money shall be paid out unless specifically authorized 
by the general court" was dropped because there were 
found to be so many advisable exceptions such as the pay- 
ment of judicial salaries, interest and debt obligations, 
and many other debatable special revenues and payments.-^ 

2. The right of the governor to designate a representa- 
tive to appear before the legislature in support of the 
budget was eliminated. This was done, as Mr. Theller 
said on the floor of the convention : *^ Because, to put it 
in plain words, we were afraid the governor, who should 
be responsible for the budget, would make some minor 
officer the 'goat' of something the governor had put in 
the budget. For that reason there was included in the 
proposed scheme only this : that the governor may come 
before the legislature." ^ 

Debate on the Budget 

The fight on the powers of the governor was still fresh 
in the memory of the convention when the budget amend- 
ment was given its third reading. It stirred the embers 
again and rekindled the smoldering fires. 

Martin Lomasney again sprang to the attack. He was 
opposed to any increase of the governor's power, to his 
participation in legislative debate, to any restriction of 
the legislature in the initiation or passage of appropriation 

* Report of Parkman, Convention Debates, Vol. 107, p. 130. 
' Convention Journal, Vol. 108, p. 26. 



148 BUDGET IN MASSACHUSETTS 

measures, and above all to the removal of the section of 
the committee's original report requiring all moneys 
received to be paid into the treasury and to be disbursed 
only on specific authorization by the legislature. "Is 
it not of more consequence," he asked, "to have that 
restriction inserted in the bill than it is to have the gov- 
ernor come in and talk to the legislature, breaking down 
the separation of our legislative, executive and judicial 
system?" ^ 

Mr. Charles L. Underbill opposed the section allowing 
the governor to discuss appropriations in the legislature, 
illustrating his points with incidents from the administra- 
tion of Governor Walsh. Mr. Samuel W. George took 
the same tack, illustrating his arguments with incidents 
from the administration of Governor Foss. The follow- 
ing from the convention debates^ is of interest, especially 
in connection with chapter IV above : 

Mr. George: . . . We had at that time elected a business 
man for governor. He had inherited a big plant over in 
Jamaica Plain, and he regarded himself a big business man; 
that is, he admitted it. He was a learned man. I know he 
was a learned man, because he was in Congress at the time, 
and after he was elected governor he thought he could hold 
both jobs, he found that he could not do that ; then he thought 
when he became governor he could appoint his successor in 
Congress. That is additional evidence of intelligence. He 
could not do that. Then he thought he could elect a United 
States Senator. Well, he did not do that. Finally, he thought 
he ought to have a budget system and a board of economy and 
efficiency to assist him. The Legislature passed a law to au- 

^ Convention Debates, Vol. 107, p. 135. ^ Ihid, Vol. 108, p. 8, 9, 10, 



CONSTITUTIONAL CONVENTION AND THE BUDGET 149 

thorize the auditor to use this very system that we are about 
to adopt, by sending the annual estimates to the governor 
and council the latter part of December. I think it was in 
the year 191 1 that this well-equipped business governor was 
to supervise the financial operations of our state appropria- 
tions. 

Mr. Brown : Mr. President. 

Presiding Officer : Does the gentleman yield ? 

Mr. George: Certainly. 

Mr. Brown : Merely to ask the gentleman if he was speaking 
strictly by the card when he said the governor wanted that 
budget system, or was it put over on him ? Did the governor 
ask for it, or did the legislature think they had him and put 
it over on him? My best memory is that the legislature 
put it over that governor and thought they had the best 
of him. 

Mr. George: Mr. President, I don't know whether the 
governor "had" the legislature, or the legislature "had" the 
governor. If the legislature "had" the governor they didn't 
have much. But I say this : that the governor advocated a 
board of economy and efficiency to consider what? To con- 
sider the budget. He made it an issue, and he took it before 
the people, and he said it would be a great thing if he only had 
a board of economy and efficiency, or efficiency and economy, 
I don't know which one it was. Now let me tell you they 
had it. We finally created the board of economy and efficiency 
and the expenses of our state government increased from 
$14,269,000 in 1911 to $20,312,000 in 1915. I don't know 
what the increase would have been if we hadn't had the board 
of economy and efficiency, but that was a fairly good increase 
imder the new system. The upshot of it was that the legisla- 
ture said : "We will give the governor, being a business man, 
an opportunity to advise the legislature," so this great docu- 
ment, which is sent in as Document No. i, was referred to the 
governor. He employed several certified accountants, and 
they drew several thousand dollars from the treasury. He 



ISO BUDGET IN MASSACHUSETTS 

kept appropriation bills back, as he did not know what to do 
with them. He never had any experience. A man might be 
a very successful man in managing a blower factory, or running 
a cotton factory, but he did not know anything about tKe 
state departments, so he employed other men who did not 
know any more than he did, except that they were certified 
accountants, and after spending $30,000 or $40,000, I think 
the last recommendation came into the legislature on April 23, 
and they kept the legislature hanging here back and forth, 
delaying public business. Finally after two or three years 
trial, the law was repealed. Now we are asked to make this 
same system a part of our Constitution. 



Certainly you don't intend to say that the governor of 
Massachusetts is going to run into the legislature every day 
or two and discuss with the legislature an appropriation bill. 
Why that is an absurdity. He ought not to do it. He ought 
not to be allowed to do it. If he was allowed to do it he 
would only do it for political purposes, that is all. Some- 
body would want him to go in and advocate a certain appro- 
priation, and if he thought there were any votes in it, he 
would go in and advocate it, if he thought there were any 
votes to go in and oppose it, he would go in and oppose it. 

Arguments in Support of the Budget. 

The action of the legislature in 191 8 in approving the 
budget bill of the joint special committee on finance and 
budget procedure made any discussion of the advisability 
of the adoption of the budget system beside the point. 
This was specifically stated by Mr. Parkman at the open- 
ing of the discussion/ and was tacitly admitted by all 
of the speakers. 

* Convention Debates, Vol. 107, p. 130. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 151 

In spite of the fierce opposition to "administration 
bills" in the debate on the executive, no voice was raised 
against the preparation and submission of the budget 
by the governor except that of Mr. George. When issues 
had become badly confused Joseph Walker went so far 
as to say : 

"I imagine that this convention really wants, if possible, 
to provide a proper budget system for the commonwealth of 
Massachusetts. I imagine an overwhelming majority of this 
convention want to do it. This matter has been agitated 
more or less, and I yet have failed to find a citizen of the 
commonwealth who does not say that he is in favor of the 
budget system — the executive budget — and does not hope 
that the convention will work out some system." ^ 

At another point in the debate, Mr. Walker wnmg 
from Mr. Lomasney this characteristic but significant 
statement : 

"I deny that statement. I rise to a question of privilege. 
I deny that statement absolutely. I am in favor of a budget 
system." ^ 

Mr. George B. Churchill also supported the budget 
amendment. He opened his remarks by saying : 

"We have before us one of the most important problems 
that has been presented to this convention. In my opinion 
a satisfactory solution of this problem is one of the most de- 
sirable things in our convention." ^ 

These excerpts indicate the position of the vast majority 
of the members of the convention. The only obstacles 

1 Convention Debates, Vol. 108, p. 36. ^ /j^,^ Vol. 108, p. 39. 

^Ihid., Vol. 108, p. 62. 



152 BUDGET IN MASSACHUSETTS 

in the way of the adoption of a budget amendment lay 
in the difference of opinion as to the details which should 
be placed in the constitution. Once Mr. Lomasney's 
main point had been disposed of by reinserting the phrase 
that "All money received on account of the commonwealth 
from any source whatsoever shall be paid into the treasury 
thereof/' ^ there were two well-defined groups in the 
convention. The first believed in placing the responsi- 
bility for the budget squarely on the governor, which made 
necessary the limitation of legislative activity in financial 
matters ; the second opposed any increase of the influence 
of the governor, especially at the expense of the legislature, 
and consequently believed in a budget system which 
divided the responsibility between the legislature and the 
governor. As no roll was called on this issue it is impos- 
sible to make an accurate analysis of the two groups. 
It is in general true, however, that the Boston Democrats 
and delegates of legislative experience formed the second 
group, while progressive Republicans and non-Boston 
Democrats composed the first. These divisions were 
far from hard and fast, however. 

Those in favor of an executive budget were led on by 
the dissenting members of the committee on finance.^ 
Mr. Theller said in the course of his remarks : 

"You are introducing an executive budget; you are trying 
to fix responsibility ; and every time you put your finger on 
the man that makes the proposals and make him justify them, 
you are simply putting another safeguard around them, and 

^ Amend, XVI, Sec, i, Convention Journal, p, 830. ^ gee page 137. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 153 

you are also doing a thing which sometime we are eventually 
going to do — remove part of the separation of powers, and 
make it a cooperation of powers and departments."^ 

Mr. Bellinger made two attempts to secure amend- 
ments to prevent the legislature from increasing the gov- 
ernor's budget. The first was an absolute restriction, 
while the second provided merely that the legislature 
" shall not increase or add items . . . except by a vote 
by the yeas and nays." ^ Without such a provision, 
Mr. Bellinger said : 

"The governor can well say, 'I will only submit a plan, 
I will not submit a real budget, but I will submit a plan,' 
and divide the responsibility with the legislature, while if 
the legislature is allowed to increase or add items only by 
a call of the yeas and nays, then the responsibility will be much 
more on the governor to prepare a correct budget, and also 
the responsibility will be placed on certain members of the 
legislature. We will know just who is to blame for increas- 
ing or adding items to the budget. The best budget system 
in this country, and the one mentioned before, the one in 
England, probably the best budget system in the world, does 
not allow Parliament or the lawmaking bodies in this country, 
to increase or add items. I believe that we should have such 
a budget system in this state, but a goodly number of the mem- 
bers of this convention seemed to be opposed to going that far. 
Therefore my amendment, which is about half as strong as my 
original amendment, the one that I offered at the other stage, 
is probably as far as they would go." ^ 

Even the innocuous amendment proposed by Mr. 
BelHnger was rejected. The vote stood 50 for and 73 

^ Convention Debates, Vol. 108, p. 27. ^ /jj^^.^ Vol. 107, p. 147. 

^Ihid., pp. 149, 150. 



154 



BUDGET IN MASSACHUSETTS 



against.^ This ended the attempt of those in favor of 
an executive budget to secure a strengthening of the 
proposed amendment. 

An attempt in the opposite direction also failed. Mr. 
Avery proposed to substitute for the amendment recom- 
mended by the committee on finance the following : 

"The general court shall establish a budget system. The 
governor shall have authority to veto items or parts of items 
in loan or appropriation bills." ^ 

Mr. Avery was so confident that his amendment could 
command a majority vote that he forced the matter to 
a roll call at the close of a protracted afternoon session. 
The vote however stood 72 for and 89 against.^ 

The issue raised in this vote was far from clear. It 
did not involve the issue between the executive and the 
legislative budget. Most of the friends of the budget 
system voted against the motion, however, and most of 
the enemies of executive power voted for it. An analysis 
of the vote shows : 



Republicans 
Democrats . 
Independents 
Progressives 
Socialists . 
Laborites . 
Total . 



For 



39 
31 

o 
o 
I 

I 
72 



Against 



62 
24 
2 
I 
o 
o 

89" 



1 Convention Debates, Vol. io8, p. 77. 



Ubid., p. 89. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 155 

There were 159 members absent. Of the 39 Republicans 
favoring the amendment, 2 were from Boston, of the 31 
Democrats, 18 were from Boston. 

Mr. Underhill's amendment, depriving the governor of 
the right to defend the budget, was adopted on a voice 
vote, the issue having been settled in the earlier debate 
on the executive. Even the friends of the executive 
budget conceded that a fight on this issue was hopeless 
and might jeopardize the entire amendment. An amend- 
ment by Mr. Hobbs, making it easier to pass private 
appropriation bills by striking out the requirement of a 
roll call and a majority vote of all members, also carried 
78 to 42 on a standing vote.^ With these changes and 
two textual improvements, the budget amendment was 
referred to the committee on form and phraseology.^ 
The suggestions of this committee on phraseology were 
adopted without opposition,^ and the convention voted 
on August 20, 1918, to submit the budget amendment to 
the people for ratification or rejection.'* 

The Convention's Address to the People, 

On the closing day of the second session of the consti- 
tutional convention, Ex-Governor John L. Bates, the 
president of the convention, summarized in an unimpas- 
sioned and non-partisan style the work of the convention. 
This statement was issued to all registered voters as "an 
explanatory statement of the amendments to be submitted 

* Convention Journal, p. 830. 2 /^^/.^ p. 832. 

^Ibid.y p. 870. * Ihid., p. 891. For text of amendment see Appendix. 



156 BUDGET IN MASSACHUSETTS 

to the people." ^ In this statement each amendment 
is briefly described together with the reasons for its 
adoption by the convention — where this could be done 
without partisanship. The following is the section deal- 
ing with the budget amendment: 

"At the last session of the General Court an excellent stat- 
ute was enacted providing for a State budget system. The 
Convention, however, has deemed it wise to recommend a con- 
stitutional provision on the subject because certain essential 
features of a satisfactory budget system are not at present 
within the power of the General Court to provide. Such a 
system should require that the Executive, who is responsible 
for carrying on the business of the State, should ascertain 
the needs of the State departments, should learn what revenues 
are available and should recommend to the General Court a 
systematic plan covering both the revenue and the expendi- 
tures of the ensuing year. The budget bill enacted by the 
Legislature last April makes adequate provision for these 
features, but since the General Court after considering the 
recommendations of the Governor may enact a general appro- 
priation bill widely different from that recommended by the 
Governor, he should be empowered to act independently upon 
each item of the bill, and not be compelled to accept or reject 
the measure as a whole. The veto power of the Governor, as 
now limited in the Constitution, does not permit this and hence 
the Convention recommends the adoption of this amendment 
setting forth the outlines of a budget system and authorizing 
the Governor to act on each item in an appropriation bill as 
if it were a separate measure. This plan will commend itself 
to the sound business sense of the people." ^ 

It is interesting to note that Mr. Bates gives the budget 
amendment twice as much space as any other amend- 

^ Amendments passed by the Constitutionial Convention, p. 15. 
» Ihid., p. 18. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 157 

ment, with the exception of that providing for biennial 
elections, and that he goes so far as to endorse the budget 
act of 191 8, to outline the principles of a budget system 
and to advocate writing it into the constitution. 

Ratification by the People. 

The vote on the amendment was very light indeed. 
There were eighteen other amendments submitted at 
the same time, and, in addition, it was a state election 
and an election for United States Senator. The total 
mmaber of votes cast for governor was 422,370 ; the total 
for senator, 417,842 ; and the total number of persons 
voting was 429,447.^ As was expected, the heaviest vote 
cast on any amendment was brought out by the initiative 
and referendum amendment, on which 96,698 blanks 
were nevertheless cast. Though the budget amendment 
was sixteenth in the list of nineteen amendments, and 
adjacent to that providing for biennial instead of annual 
elections, it received the hghtest vote at the election 
without exception. A total of 192,407 blanks were cast, 
distributed among the counties in varying proportions. 

The vote on the 19 amendments submitted to the people 
by the constitutional convention in November, 19 18, is 
shown in the table on the following page. 

It will be seen that every amendment was carried by a 
substantial majority, and that the budget amendment 
ranks among the four receiving the fewest opposing votes. 

^ Calvin Coolidge, Governor ; David I. Walsh, Senator. From record of 
votes issued December 11, 1918, by the council; Public Document 43, 1918. 



158 BUDGET IN MASSACHUSETTS 

Popular Vote on Constitutional Amendments, 191 8 * 



Amendment 


Yes 


No 


Blank 


Initiative and Referendum . . . 
Public Interest in Natural Resources 
Regulation of Advertising . . . 
Preservation of Landmarks . . . 
Adjournments of General Court . 

Militia Officers 

Governor as Commander-in-Chief . 

Order of Succession 

Governor's Recommended Amend- 
ments 


170,646 
172,111 
193,925 
183,265 
147,104 
155,649 
155,114 
172,125 

164,499 
153,315 
156,796 
161,833 
161,214 
134,138 
153,972 
155,738 
142,868 
152,800 
158,394 


162,103 

102,768 

84,127 

81,933 
100,552 
91,686 
84,822 
78,245 

76,972 

105,591 
86,023 

79,787 

83,095 

128,403 

90,233 
81,302 
108,588 
87,009 
81,586 


96,698 
154,568 

151,395 
164,249 
181,791 
182,112 
189,511 
179,077 

187,976 

170,541 
186,628 
187,827 
185,138 
166,906 
185,242 
192,407 
177,991 
189,628 
189,467 


Women Notaries Public .... 
Retirement of Judicial Officers . . 
Revocation of Franchises .... 

Building Zones 

Compulsory Voting 

Lending State Credit 

BUDGET SYSTEM 

Biennial Elections 

Recess Committees 

Executive Reorganization . . . 



Analysis of Vote. 

The following tabulation shows the comparative extent 
of interest shown in the counties as evidenced by the per- 
centage of those voting who voted on the budget amend- 
ment. The counties fall into the following three groups : 

Group I. Most interested counties, in which the blank votes 
were 45 per cent and below : Bristol, Essex, Hamp- ^ 
den, Middlesex, Norfolk, and Suffolk. 

Group 11. Less interested counties, in which the blank votes 
were 46 per cent and 47 per cent : Barnstable, 
Berkshire, Hampshire, and Worcester. 

1 The amendments are presented in the order in which they appeared on the 
ballot. From the official return of votes as issued by the council, December 11, 
1918. 



CONSTITUTIONAL CONVENTION AND THE BUDGET 159 

Group III. Least interested counties, in which the blank votes 
were 48 per cent and above: Dukes, Franklin, 
Nantucket, and Plymouth. 

The lowest percentage of blank votes was 42 per cent 
for Middlesex, and the highest, 58 per cent for Nan- 
tucket. 

The six most interested counties represent the predomi- 
nantly urban sections of the state. They contain all but 
one of the ten largest cities,^ and over 76 per cent of the 
total population. The density of population in each of 
the six most interested counties is greater than that in 
any of the remaining counties. The density of population 
and the assessed wealth in the three groups is : 





POPUJ-ATION PER 

Square Mn.E 


Assessed* 
Wealth 


Group I (most interested) 

Group II (less interested) 

Group III (least interested) 


961 
188 
141 


$4,474,685,415 
716,605,209 
244,914,060 



There were three counties, Dukes, Franklin and Nan- 
tucket, which returned a majority against the adoption 
of the budget amendment. These three counties are the 
three ranking at the bottom of the list in density of 
population. Their combined population per square mile 
is but 66. They also represent three of the four least 

* Worcester. Blank votes in the city of Worcester itself were but 40 per cent. 
Public Document 43, 1919. 

2 N. B. this is the "assessed wealth," and fails to include a large part of the 
intangible wealth, most of which is concentrated in the group one counties. 



i6o 



BUDGET IN MASSACHUSETTS 



interested counties in the vote on the budget amend- 
ment.^ 

An analysis of the vote on the budget amendment by 
cities and towns shows a similar situation. The following 
table shows the number of towns, by population groups, 
voting for and against the budget amendment : 

Vote by Cities and Towns on Budget Amendment 



Population Class 


Majority For 
Budget 


Majority Against 
Budget 


Total Number at 
Cities & Towns 


5000 and below .... 
5000 to 10,000 .... 
10,000 to 30,000 . . . 
30,000 to 100,000 . . . 
Above 100,000 .... 


106 

47 

34 

18 

6 


133 
6 

I 

I 
I 


239 
53 
35 
19 

7 


Total ' 


211 


142 


2,Sl 



The population of the 211 cities and towns in which 
a majority vote for the budget amendment was cast was 
3,308,580, or 90 per cent of the total population of the 
state. The chief opposition to the budget came from the 
small towns and the support from the cities.^ 

In spite of the extraordinarily light vote on the budget 
amendment in comparison with the other eighteen amend- 
ments submitted at the same election, such a comparison 
also shows that there were but eight amendments that 
carried with a larger percentage majority. It is also of 
interest that the budget amendment was defeated only 
in the three counties which defeated every other amend- 

^ Population and density figures are from the 1915 Massachusetts Census, 
Table 11 ; Wealth figures from 19 16 apportionment. 
2 1919 Public Document 43 ; State Census of 1915. 



CONSTITUTIONAL CONVENTION AND THE BUDGET i6i 

ment. There were but six other amendments which re- 
ceived a majority vote in all but these three conservative 
ultra-rural counties ; the initiative and referendum amend- 
ment was carried in but two counties, Suffolk and Plym- 
outh; and the compulsory voting amendm^ent, which 
preceded the budget on the ballot, was carried in but 
four.^ 

From these facts it is clear that the people as a whole 
had very little interest in the budget amendment ; they 
had less interest in it than in any other amendment sub- 
mitted at the fall election. In spite of this marked 
apathy, there was considerably more interest in the budget 
in the populous urban sections than in the rural counties, 
and the only counties to return a majority against the 
budget amendment were the three most rural counties 
of the state, counties which voted against every other 
amendment submitted. Few cared about the budget 
and those few Uved in the cities. It was their votes 
that placed the budget amendment in the constitution 
of Massachusetts. 

^ Record of Votes issued December ii, 1918, by the Council. Public Docu- 
ment 43, 1919. 



CHAPTER IX 

EXPERIENCE WITH THE BUDGET IN 1919 

The experience of Massachusetts with the budget in 
1 91 9 is signij&cant, as it represents the first year under the 
budget law enacted by the 191 8 general court as well as 
the first year under the 191 8 budget amendment to the 
constitution.^ These two budget provisions, one of law 
and one of the constitution, were prepared and carried 
to enactment and ratification by two overlapping groups 
of men who acted at all times in thorough harmony. As 
a result the two provisions dovetail into one another with- 
out a seam. The budget amendment of the constitution 
adds materially Jo the budget law in the sections dealing 
with appropriations and the veto of items ; while the bud- 
get law supplements the constitutional provision in the 
sections dealing with the form and content of the budget 
and its preparation by the supervisor of administration. 

Form of Estimate Blanks for State Departments, 

The estimate blanks issued to the departments and in- 
stitutions in 1 91 8 for the 191 9 budget were prepared by 
the supervisor of administration. They follow in the 
main the blanks as previously issued by the auditor, 
though considerably more classification and detail is 

* Constitutional Amendments 1918, No. 16; General Acts 1918, Ch. 244. 

162 



EXPERIENCE WITH THE BUDGET IN 1919 163 

required in the estimates for personal service, and a more 
systematic grouping of estimates for foods, except in the 
normal schools, is furnished. 

In conformity with sections i and 2 of the budget act, 
one set of estimate sheets is prepared for maintenance and 
other ordinary expenses aheady authorized by law and 
another set for extraordinary expenses, for capital out- 
lays, and objects not as yet authorized by law. Because 
of the essential difference between the information required 
concerning the maintenance of departments and of state 
institutions a separate set of blanks is used for the two. 
In the case of normal schools still another set of blanks 
is provided. Briefly these blanks are as follows : 

I. Estimate Blanks for Maintenance. 

a. Departments, Boards, Commissions and other non-insti- 
tutional agencies of the Commonwealth. 
Estimates on six forms, showing, 
Form I. Name of department, total estimate, signature. 
Form 2. Classified estimate for personal services, show- 
ing total salary roll at beginning of previous year, with 
total changes due to salary increases or to new positions 
or to elimination of old positions or to vacancies ; and 
showing proposed changes for the coming fiscal year 
for salary increases, filling positions now vacant, new 
positions, and temporary service. 
Form 3. Supporting details for Form 2, giving each 
salaried officer or employee separately with official 
classffication, present rate of salary, proposed increase, 
and the amounts required for new employees. 
Form 4. Detailed estimates for office and incidental 
expenses, showing separately, books, maps, express- 
age, postage, printing, etc., including typewriters and 



l64 BUDGET IN MASSACHUSETTS 

other machines. The amounts expended the previous 
year are required in a parallel column.^ 

Form 5. Detailed estimates for traveling and other 
expenses classified to show purposes of travel, means 
of travel, etc., together with the expense of the pre- 
vious year. Estimates for other expenses are itemized 
by the department to fit its individual needs. 

Form 6 (which is attached to and forms the second 
sheet of form i). Summarizes the estimates presented 
on forms 2 to 5, cites the statutory authority for each 
group, and presents for comparison the last appropria- 
tion similarly classified. 
b. Hospitals, Insane Asylums, Prisons, and all other institu- 
tions except Normal Schools. 
Estimates on 36 forms : 

Form I. Name of institution, total estimate, signature. 

Forms 2 to 24. Classified estimates for personal services 
with supporting details, same general form as form 2 
for departments. Each of the following groups are 
segregated, with two blanks apiece: medical staff, 
administration, kitchen and dining room service; 
domestic service, ward service male, ward service fe- 
male, industrial and educational, engineering, repairs, 
farm ; stable, garage and grounds ; and religious in- 
struction. This last has but one blank. 

Form 25. One page summary of forms 2 to 24 with 
comparative appropriation allotments for each ser- 
vice. 

Forms 26 to 35. Detailed estimates each on a separate 
form for : travel, transportation and office expenses ; 
food; clothing and clothing materials; furnishings 
and household supplies; medical and general care; 
heat, light and power; farm and stable; grounds; 

1 As the year previous to the year for which estimates are offered does not close 
till a month and a half after the estimates are due, the expenses of the previous 
year are made up from 9 months' actual and 3 months' estimated expenses. 



EXPERIENCE WITH THE BUDGET IN 1919 165 

repairs, ordinary; and repairs and renewals, not re- 
curring annually. Expenses for freight, contract 
services, and other distributable expenses, including 
extra service, are apportioned under each head. New 
boilers, new engines, etc., are included under repairs, 
not recurring annually. 

Form 36. (Attached to form i.) Summary of forms 
25 to 35, with statutory authorizations and previous 
appropriation. 
c. Normal Schools. 

Estimates on 17 forms, as follows : 

Form I. Name of Normal School, total estimate, signa- 
ture. 

Forms 2 and 3. Personal services, classified and in de- 
tail as on forms 2 and 3 of departmental estimates. 

Forms 4 to 11: Detailed estimates, each on a separate 
form for : travel, office and other expenses ; normal 
school supplies ; training school supplies ; furnishings; 
heat, light and power ; grounds ; repairs, ordinary ; 
and repairs and renewals, not recurring annually. 

Form 12. Simimary for normal school boarding hall, 
showing: receipts past year; average number of 
boarders ; and expenditures for personal services, food 
materials, supplies and other expenses. 

Forms 13 and 14. Normal school boarding hall, personal 
services, classified and in detail as on forms 2 and 3. 

Form 15. Detail estimate for boarding haU food, with 
expenditures for last year. 

Form 16. Detail estimate for boarding hall supplies 
and other expenses, with expenditures for last year. 

Form 17 (attached to form i). Summary of forms 2 
to 16, with statutory authorization and previous ap- 
propriations. 
2. Estimate Blanks for Special Purposes. 

Form I. Name of department or institution; object; 
summary of estimates ; signature. 



1 66 BUDGET IN MASSACHUSETTS 

Form 2 (attached to form i). Explanation and de- 
tails of each project listed on form i. 

In case of estimates for building construction or alter- 
ations, including heating, plumbing, lighting, and 
ventilation, preliminary studies, general specifications 
and one reliable estimate shall accompany forms i and 
2 if the estimate for any one purpose exceeds $5000.^ 

Preparation of the Budget by the Supervisor of Administra- 
tion. 

The departmental and institutional estimates for the 
1 91 9 budget wer6 due in the hands of the supervisor by 
October 15, 1918. As a matter of fact, many estimates 
were not received until after this date. This is especially 
true of estimates for special purposes. While this was 
due in a measure to negligence on the part of state officials, 
it was also due to the war situation. The signing of the 
armistice on November 11, 191 8, made it possible for the 
institutions to lay plans for new construction in'1919 which 
would not have been requested under war conditions. 
In fact, 84 per cent of the total estimates for special pur- 
poses submitted to the supervisor were filed after the 
time fixed by law. The estimate of the commission on 
waterways and public lands, amounting to $2,547,000, 
was not filed till December 30. 

Mr. Carl A. Raymond, deputy supervisor of adminis- 
tration, took personal charge of the revision of estimates 
and the preparation of the 191 9 budget. Though he was 
assisted by other members of the office, the major part 

^ The form numbers here assigned are those of the author. 



EXPERIENCE WITH THE BUDGET IN 1919 167 

of the work fell entirely on him, even to the extent of the 
preparation of comparative tables. Mr. Raymond fol- 
lowed in the main the procedure he had worked out in 
1 91 8, and called the department heads in to go over 
with him the estimates they had submitted. While most 
of these conferences were with not more than a single 
individual, a few of them assumed the aspect of large 
hearings. Of some of these conferences a stenographic 
record was kept, while of others Mr. Raymond was satis- 
fied with a memorandum which he himself dictated cov- 
ering the main questions involved. In each case, he 
dictated a brief statement of his tentative decisions with 
regard to the estimates involved. All of the memoranda, 
with such other material as was pertinent, were bound in 
with the related departmental or institutional estimates 
in a large looseleaf binder. All of the estimates together 
filled three large volumes. These are Mr. Raymond^s 
private estimate files and contain many pencilled nota- 
tions and references on the estimate sheets in addition 
to the various memoranda and other papers. 

The requests submitted to the supervisor of adminis- 
tration, and his recommendations, are indicated in the 
table on the following page. 

It will be observed by comparison with the figures on 
page 80 that the reductions made in departmental esti- 
mates in preparing the 19 19 Budget were greater than 
those made in 191 8 for maintenance appropriations, but 
that the 191 9 reductions in capital outlays were con- 
siderably smaller. 



i68 BUDGET IN MASSACHUSETTS 

Departmental Estimates for 1919 and the Supervisor's Budget 
Recommendations ^ 





Departmental 


SUPERVISOR'S 


Reduction 






%of 
esti- 




Estimates 


Recomme ndation 


Amount 










mates 


Maintenance 










State departments and 










institutions . . . 


$29,975,709.34 


$27,892,794.05 


$2,082,915.29 


6.9 


Metropolitan districts 


2,260,861.36 


2,116,493.41 


144,367.95 


6.4 


Total maintenance 


32,236,570.70 


30,009,287.46 


2,227,283.24 


6.9 


Capital Outlays and 










Specials 










State departments and 










institutions 










submitted too late . 


3,359,011.50 


1,200,000.00 2 


2,227,283.242 


64.22 


submitted in time . 


937,545-63 


511,293.55 


426,252.08 


454 


Metropolitan districts 


306,000.00 


281,000.00 


25,000.00 


8.1 


Total capital outlays . 


4,602,557.13 


1,992,293.55 


2,610,263.58 


56.7 


Interest and Debt , . . 


3,738,353.44 


3,738,353.44 






Grand Total .... 


$40,577,481.27 


$35,739,934.45 


$4,837,546.82 


11.9 



The Governor's Submission of the Budget. 

The tentative budget for 191 9 was delivered to the 
newly elected governor on January 3, 1919.^ On January 
8, Governor Coolidge transmitted the document, with- 
out change, to the general court.^ While the intervening 
period was unquestionably too brief to allow any con- 
sideration of the details of the budget, it must be remem- 
bered that Governor Coolidge, as lieutenant governor, 
was remarkably familiar with the affairs of the common- 
wealth. It is also reported that he was consulted during 
the preparation of the budget on doubtful questions as 
they arose. The budget was prefaced by a four-and-a- 



1 Based on 1919 House Document 185, pp. 7, 14, 31, 76, 79, 81, 103, 113, 117- 



123 



2 Tentative recommendation. Ibid., p. 14. ^ Ibid., p. 13. ^ Ibid., p. 5. 



EXPERIENCE WITH THE BUDGET IN 1919 169 

haK page letter of transmittal signed by the governor. 
The key sentences from this letter were : 

" In compliance with the provisions of the Constitution . . . 
and the laws of the Commonwealth, ... I am submitting 
• herewith budget recommendations for the fiscal year 1919. . . . 
The Auditor of the Commonwealth's estimates of receipts from 
the ordinary and other revenue for 191 9 . . . is as follows, — 
. . . The proposed expenditures [i.e. unrevised departmental 
estimates] amount to . . . The estimates for expenditures 
have been studied by the Supervisor of Administration, and 
his recommendations are embodied in the summary of financial 
statements submitted with this budget. . . . This is surely 
not the time for indiscriminate increases in salaries and wages. 
There are however, some deserving cases in some branches of 
the service where further increase would be justified. . . . 
The unprecedented high prices of commodities is also reflected 
in the request for appropriations. This is a subject which 
should be given very careful attention. . . . The requests 
of the MetropoHtan Park Commission and Metropolitan Water 
and Sewerage Board are included in the summary of financial 
statements, together with the recommendations by the Super- 
visor of Administration. . . . No deficiencies in appropriations 
of 1918 requiring appropriations this year have been reported. 
. . . The proposals for capital outlay amount to . . . A 
large part of this sum is made up of requests filed long after 
October 15, the statutory date for filing estimates. The 
Supervisor of Administration is unable at this time to recom- 
mend a number of projects, and others are receiving further 
study. Should it appear desirable, these will be included in a 
supplemental budget. . . . Interest requirements of . . . 
and sinking fund and serial bond requirements of ... is the 
tribute we must pay to former administrations in their having 
put off the date of settlement with the tax collector. . . . The 
net direct debt of December i, 19 18, shows a decrease for the 
past year of ... . Nothing is better than the 'pay as you 



I70 BUDGET IN MASSACHUSETTS 

go' policy, and it is hoped the Legislature of 19 19 will find it 
expedient to finance their obligations for all normal require- 
ments without recourse to loans. . . . Estimates have been 
filed for new projects and undertakings of . . ., to which must 
be added all sums due to the reconstruction or transition period, 
which you may after mature deliberation consider worthy of 
enactment. In this field I may later find it desirable to make 
specific recommendations. . . . The estimates for revenue 
submitted by the Auditor of the Commonwealth appear to be 
very conservative. . . . The summary tables are made up 
with a tentative figure of $11,000,000 for the state tax. This 
sum should be a maximum, and I urge you to practice economy 
to such an extent that after all proper and reasonable provi- 
sions have been made for works of reconstruction and assimi- 
lation of the soldier into civil life, the tentative amount for the 
state tax may be reduced." ^ 

The italics and brackets are here inserted to call at- 
tention to the fact that the governor made no specific 
recommendations whatsoever with regard to the revenues 
or the expenditures of the state. His message assumed no 
responsibility for the budget, and referred to the only seC' 
tion of the document that recommended a specific course of 
action measured in dollars and cents as "the supervisor's 
recommendations." In the governor's entire message 
there was no statement of the total expenditure recom- 
mended by the budget. He contented himself with recit- 
ing the unrevised departmental requests. 

Budget Recommendations of Inaugural Address. 

Governor Coolidge's refusal to take any responsibility 
for the 1 9 19 budget is all the more significant in the light 

* 1919 House Document 185, p. 5. 



EXPERIENCE WITH THE BUDGET IN 1919 171 

of the recommendations of his inaugural address, dehvered 
on January 2, a week before the presentation of the budget. 
In that address there are no less than thirteen major 
recommendations which belonged in the 191 9 budget. 
Take for example the governor's recommendations for the 
welcome of returning troops, for the subventions to public 
schools, for the instructions of aliens in English, for a 
survey of the street railway situation, for the improvement 
of the port of Boston, for the Plymouth exposition, and 
for the creation of a loan fund to encourage home owning. 
In a number of these recommendations he said in so many 
words, ^^It is urgently recommended that such taxes 
be laid and appropriations made" as are necessary, or, 
"To begin this great and important work some appro- 
priation should be made.'' ^ Why was it that the "gov- 
ernor's budget" made no allowance for the financial 
aspect of the legislative program of the governor as laid 
down in his inaugural ? 

The governor's policy seems to have been calculated to 
avoid any possible breach with the legislature. That 
friction over the new budget powers of the governor 
was possible was indicated by the remarks of more 
than one legislator at the convening of the general 
court. This feeling disappeared during the session 
both because of the governor's policy and because 
of the remarks and leadership of the chairman of the 
house committee on ways and means, Representative 
Benjamin Loring Young. 

1 1919 Senate Document, p. 6, 9, etc. 



172 BUDGET IN MASSACHUSETTS 

Form and Content of the igig Budget, 

Eliminating the governor's letter of transmittal, the 
1 919 budget is composed of: 

1. A seven-page statement by the supervisor, explaining 
in detail the recommendations for capital outlays contained 
in subsequent pages. The requests for the metropolitan dis- 
tricts are included. 

2. The auditor's estimate of revenues for 1919 by sources. 

3. A summary of general fund treasury transactions for 19 18. 

4. Statement of the condition of the state debt, showing 
the direct and the contingent debts separately. 

5. A six-page statement of the recommended appropria- 
tions for 1919, excluding metropolitan districts, itemized by 
spending units, and showing the amounts allowed for salaries, 
other expenses, and capital outlays and the source from which 
the appropriation was to be financed. 

6. A general summary of receipts, excluding metropolitan 
districts, showing by sources the amounts credited to the 
general fund, to special funds, and the total. 

7. A balance sheet as of the end of the fiscal year of 19 19, 
based upon the two preceding tables. 

8. A detailed estimate of proposed expenditures for 1919, 
for the state government, including the legislative and judi- 
cial departments. This statement covers 85 pages, and con- 
tains 507 enumerated items many of which are further sub- 
classified. A sample section of this book of estimates is re- 
produced below. 

9. An identical statement for the metropolitan districts. 
The items are numbered consecutively, following right on from 
those above. 

It is to be noted that the governor's budget contained 
no appropriation bill. 

Opposite are two sections from the detailed esti- 
mate of proposed expenditures for 1919. The item 



EXPERIENCE WITH THE BUDGET IN 1919 



173 









O 

so- 

< 






9. 9« 9, 

O woo 



9. 9. 9 

o <s 00 



000 

8 8 8 



000 
000 
000 



00 








r^ 





8 





on 


t^ 


8 





8 





vO 

















vo 


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174 BUDGET IN MASSACHUSETTS 

numbers of column i were followed in the appropriation 
bill. The estimates are classified by spending units, 
and the capital outlays are in each case grouped after the 
maintenance items of the institution or department in 
question. 

Legislative Consideration of the igig Budget, 

The budget, on receipt, was referred immediately to 
the house committee on ways and means. Representa- 
tive Benjamin Loring Young was now chairman of this 
committee in place of Representative Joseph E. Warner, 
who had been elected speaker of the house.^ 

Work of the House Committee on Ways and Means. 

"Immediately on receipt of the budget," Mr. Young 
reported to the house, "the Committee sent a notice to 
each state department, setting aside two weeks for public 
hearings and inviting all persons interested to appear. 
The Committee also requested that statements in writing 
be filed. Open hearings continued for two weeks and 
a further week was devoted to executive sessions." ^ 
During this time, Mr. Raymond, who had prepared the 
budget for the governor, and Mr. Hawley, deputy auditor, 
were in constant attendance. Mr. Raymond had with 
him his personal estimate files mentioned above, for his 
own information and for the use of the committee. Under 
the direction of Mr. Yoimg, who took an unusually active 
part in the revision of the budget, Mr. Raymond drafted 

* Bulletin 43, p. 122. ^ House Document 1370, p. 25. 



EXPERIENCE WITH THE BUDGET IN 1919 



175 



the various appropriation and other measures for the com- 
mittee, with the exception of a few matters handled by 
the deputy auditor. 

The following table indicates, as far as figures can show, 
the work of the house ways and means committee on the 
budget of 1919 : 

191 9 Budget Cuts of the House Ways and Means Committee^ 




By a comparison with the figures presented on page 
loi above, it will be seen that the ways and means com- 
mittee of 1 91 9 found it possible to make slightly larger 

* Based on p. 168 above; House Documents 1354 and 1370, p. 32. 
^ Increase. 

^ Referred to the committee on metropolitan affairs. These estimates repre- 
sented requests for bond issues for as yet unauthorized projects. Strictly their 
elimination should not be considered as budget cuts, though they are included 
here to reconcile the budget and the appropriation act. 

* At the time of the preparation of the budget no deficiencies were reported, 
^ Increase. 



176 BUDGET IN MASSACHUSETTS 

decreases in the budget than was found possible in 191 8. 
This was largely due to the war conditions. In 191 8 
the budget was prepared at a time of sharply rising costs. 
The price-movement itself squeezed out the surpluses, 
while in 191 9 the committee was called on to revise after 
the armistice a budget which was drawn on the basis of 
pre-armistice estimates. 

The Budget Bill before the House. 

On February 10, Mr. Young reported for the ways and 
means committee the general appropriation bill based 
on the budget. This bill contained appropriations for 
maintenance and capital outlays, so far approved by the 
supervisor, both for the state and for the metropolitan 
districts. There were 515 numbered items grouped by 
spending units, except in the case of interest and deficien- 
cies, which carried a total of $34,944,664.22. An analysis 
of the bill appears on page 175. The bill follows closely 
the bill of the previous year, and continues in the main 
the policy of lump sum appropriations. There are five 
items of $1,000,000 or more, and 63 items of $100,000 or 
more. The average item of the bill is $67,000. The 
corresponding average in 191 8 was $46,000. Appropria- 
tions for the legislative and judicial departments are 
included. 

In presenting the budget bill, Mr. Young addressed the 
house on the finances of the state and the fiscal program 
for the following year. Since the joint address of the 
general court to the people of the state on February 27, 



I 



EXPERIENCE WITH THE BUDGET IN 1919 177 

1 781, no comparable statement had been prepared in 
Massachusetts.^ 

The Main Points of the Budget Speech, 
In introducing the budget bill, Mr. Young said : 

"My remarks will naturally divide themselves under four 
heads, — 

"I. An explanation of the constitutional amendment for 
a state budget recently adopted by the people, and a brief 
statement of the various modifications in the financial pro- 
cedure of the house and of the general court which would seem 
to be made necessary or advisable by its adoption. 

"11. An explanation of the appropriation bill now reported 
to the house by the committee on ways and means, and a brief 
discussion of several of its more important features. This 
discussion may serve to point out to the members of the house 
some of the more difficult problems which confronted the com- 
mittee, those in which the members will probably be most in- 
terested, and with regard to which they have a right to demand 
complete, detailed and satisfactory information. It is my hope 
that before this bill is passed to be engrossed every question 
of doubt in the mind of any member may be satisfactorily 
answered by the committee, and that no member can justly 
say that he has not been given an opportunity to know and 
understand every detail thereof. 

"III. An explanation of the general financial policy out- 
lined by His Excellency the Governor in his budget recom- 
mendations (House Document No. 185), and the manner in 
which the bill now under consideration carries out that policy 
in part, together with a brief survey of such additional appro- 
priation bills as may reasonably be expected to come before 
the general court after final action on the present bill either 
through the submission of supplementary budgets by the gov- 
ernor or otherwise. 

* See page 12. 



178 BUDGET IN MASSACHUSETTS 

** IV. A statement of work accomplished by the committee 
on ways and means, and of the method adopted by it during 
its consideration of the budget." ^ 

Following the outline just presented, Mr. Young pro- 
ceeded with his first point. Though we have outlined 
the constitutional amendment earlier in our discussion, 
the following excerpts from the budget speech are worthy 
of note : 

"The budget is not a mere document, it is not a mere appro- 
priation bill. The budget is the plan for financing the state 
government for the current fiscal year, which has been pre- 
pared under the direction of the governor and has been sub- 
mitted by him to the general court for its consideration. The 
budget contains an appropriation program, a social program, 
a revenue program. It is a complete plan for the government 
of the commonwealth. The general appropriation bill based 
upon the budget, now before the house for consideration, is 
merely one feature of that plan." 

"The statute and the constitutional amendment taken to- 
gether make the governor, so far as finance is concerned, the 
actual executive head of the state in practice as well as theory. 
In place of an irresponsible government by boards and com- 
missions, each anxious to augment its own importance and its 
own financial needs, we have lodged full responsibility with the 
governor, whose viewpoint is not limited to a particular de- 
partment or to a particular locality, but extends to the entire 
state government of which he is the responsible head." 

"Departmental requests for appropriations should be con- 
sidered by the general court only in connection with the budget, 
and such requests should not be allowed under the guise of 
special bills or resolves." 

* 1919 House Document 1370, p. i. 



EXPERIENCE WITH THE BUDGET IN 1919 179 

"A few departments, however, which neglected to file a por- 
tion of their estimates in October, have now come to the general 
court with requests for appropriations embodied in special bills. 
. . . They have refused to enter the open door of the budget, 
and now seek to obtain entrance to the public treasury through 
the back door of special legislation. If the budget system is to 
stand, these special bills should not receive favorable considera- 
tion at this time." 

"The power of the general court to add items should ob- 
viously be construed as being limited to departmental esti- 
mates embodied in the budget, or to other appropriation items 
properly before the general court under its rules." 

" If the governor sees fit to make additional financial recom- 
mendations in a supplementary budget, his requests should 
again have the right of way, and until final action thereon 
should have precedence over all other appropriation bills." ^ 

In disposing of his remaining three points, Mr. Young 
proceeded with equal clarity and force. His discussion 
of the main issues contained in the general appropriation 
bill is full of information for the legislature, and is entirely 
free from the all too common "pussy-footing" in the dis- 
cussion of appropriation matters. When Mr. Young 
told the house that he hoped that debate on the budget 
bill would result in "thorough, frank and pertinent dis- 
cussion of the budget proposals,'' he was clearly saying 
what he meant.^ 

^ 1919 House Document 1370, pp. 5-8. In view of the interpretation con- 
tained in the last paragraph quoted it should be noted that Mr, Young is him- 
self a lawyer, and that his interpretation is based on interviews with the at- 
torney-general and with members of the constitutional convention who were 
especially well informed on budget questions. Ihid,^ p. 4. 

2 House Document 1370, p. 25, 



l8o BUDGET IN MASSACHUSETTS 

With the budget speech was presented a balance sheet 
as of the end of the fiscal year in question, a table show- 
ing the individual cuts and increases made by the com- 
mittee on ways and means, a table showing the recom- 
mended appropriations compared with those of 191 8, 
and a table of the per capita weekly costs for maintenance 
of the state institutions. 

Newspaper Comment on Mr, Young^s Budget Speech, 

When Governor Coolidge presented the 19 19 Budget 
to the legislature on January 8 there was no dramatic 
incident. There was no "news" to attract attention. 
The document went to the clerk of the house with a for- 
mal letter from the governor, the clerk of the house read 
the title of the report amid the drone of the routine busi- 
ness, and the document was referred to ways and means 
and lost from sight. It is surprising that any of the papers 
mentioned the budget at that time. As a matter of fact 
few did, and those few failed to get at the meat of the 
matter.^ 

The situation was quite different now. Mr. Young's 
personal presentation of the general appropriation bill, 
together with his concise and straightforward discussion 
of the issues involved, introduced enough of the dramatic 
element to carry the budget into almost every paper of 
the state. The Christian Science Monitor, which tends 
to exclude matters of sectional interest, devoted the better 
part of a column to Mr. Young's budget speech, quoting 

1 E.g. Boston Heraldy January 9, 1919, p. 7. 



EXPERIENCE WITH THE BUDGET IN 1919 i8i 

liberally from him, and stressing four of the major issues 
he had raised.^ The Boston Globe of February lo and the 
Springfield Republican of February ii cover the inci- 
dent in their news columns. 

The following editorial from the Transcript, which had 
also carried the story as news, deserves reproduction 
here. The title was "Loring Young's Contribution,'' — 

*'The speech which Representative B. Loring Young de- 
hvered in the house yesterday, as chairman of ways and means, 
clearly advanced the commonwealth's budgetary process one 
step forward. If the vigorous efforts made in the last general 
court by the present speaker of the house, Mr. Joseph E. Warner, 
brought the schedule of appropriations into definite summary 
early in the session for the first time in the state's history, and if 
the executive budget submitted this year repeated this useful 
accomplishment, Mr. Young has held by these gains in proce- 
dure and also gone them one better. He has associated with 
his comprehensive view of the state's proposed expenditures a 
comprehensive view of the state's whole legislative program, 
thus equating, as it were, problems in the distribution of cash 
with problems in the distribution of the general court's energies 
as a state-governing and state-building body. 

"Obviously this is a proper juxtaposition. The chairman 
of ways and means has avoided dogmatic pronouncements of 
approval or condemnation concerning various items of the 
state's proposed legislation. He has left that work to the 
judgment of the general court where it belongs. But he has 
given the general court opportunity to base its judgments as 
to individual proposals upon a sound sense of their relation to 
the state's legislative requirements in their entirety, and he 
has permitted them to see individual appropriations in their 
due proportion to the total funds which the state has on its 
hands or dares to expend. This is to add to economy in cash, 

^ February 13, 1919, p. 9. 



l82 BUDGET IN MASSACHUSETTS 

clarity and balance of statesmanlike perspective, and it is to 
advance our use of the budgetary process one important step 
forward,'* ^ 

Debate on the Btidget Bill in the House, 

Following the presentation of the budget bill and the 
budget speech, the better part of a week was devoted to 
the debate on the bill. During this time Mr. Young 
was continually on his feet explaining the budget bill 
and answering criticisms. As a result of this discussion 
and of later information, the ways and means committee 
itself, through its various members, brought forward a 
number of amendments to the bill. Three of these were 
textual amendments, one decreased, while five increased, 
appropriations in the bill. Nine private amendments were 
offered to strike out or to reduce items, while two were 
offered to increase the appropriation for band concerts in 
the metropolitan district of Boston. All of the amend- 
ments put forward by the committee were adopted, 
and of the private amendments five to decrease were 
accepted by Mr. Young and adopted by the house, while 
the two amendments to increase were opposed by Mr. 
Young and were defeated.^ The changes made were as 
follows : 





Number of Items 


Amount 


Increases 


6 
6 


$ 164,641.25 
46,300.00 


Decreases 


Net Increase 




$118,341.25 



1 February 12, 1919. ^ House Journal, pp. 367, 398, 408. 



EXPERIENCE WITH THE BUDGET IN 1919 183 

The total increase, all of which was moved by the com- 
mittee, amounted to less than one half of one per cent of 
the total carried by the budget bill, and the net increase 
was one third of one per cent. It will be seen that the 
leadership of the committee on ways and means was 
unquestioned. 

The Budget Bill before the Senate. 

The general appropriation bill was received in the sen- 
ate on March 5. It was immediately referred to the 
senate ways and means committee. Here it was held 
till March 28, when it was reported with 20 amendments.^ 
Of these, five were textual; one segregated an appro- 
priation by splitting an item in two ; two decreased items, 
and the remaining 12 provided increases. The total 
decreases amounted to $53,000 and the increases to 
$45,370, leaving a net decrease of $7,630. On April 2^ 
aU of these amendments put forward by the committee 
were adopted. In one case only was a roU called.^ At 
the same stage, three private amendments were offered 
to increase items, two of which were to negative reduc- 
tions made from the floor of the house. The third in- 
creased the $25,000 appropriation for band concerts in 
the metropolitan district by $5,000.^ These three private 
amendments were also adopted. 

As a result of the action of the senate, the budget bill 
total was changed as follows: 

^ Senate Journal, p. 536. 2 /jj^.^ p. 536-538. 

3 $30,000 was the customary annual appropriation. 



i84 



BUDGET IN MASSACHUSETTS 





Number of Items 


Amount 


Decreases 

Increases 


2 

15 


$ 53,000.00 
52,770.00 




Net decrease 




$ 230.00 



House Refuses to Concur, 

After a brief consideration of the senate amendments, 
the house ways and means committee reported by its 
chairman, Mr. Young, that the house ought not to con- 
cur on five of the amendments made by the senate. 
Two of these increased the appropriation for the bank 
commissioner's office, two more replaced the amounts 
cut from the governor's budget in the house for the bureau 
of immigration, while the fifth increased the personal 
service appropriation for the state board of charity. After 
debate, the house followed the lead of Mr. Young and his 
committee, and after non-concurring in the five objection- 
able amendments, accepted the balance.-^ 

Conference Committee Arrives at Compromise, 

A conference committee representing both ways and 
means committees was appointed, and on April 15 the 
committee reported that the senate ought to recede on 
two, and the house on three, of the points at issue. This 
compromise was accepted in both houses without debate, 
and under a suspension of the rules. ^ It is interesting 
to note that the two amendments from which the senate 



^ House Journal, p. 741. 



2 Ihid., p. 781 ; Senate Journal, p. 620. 



EXPERIENCE WITH THE BUDGET IN 1919 185 

receded were both private amendments. As a result, 
there was but one private amendment to increase which 
became part of the appropriation bill. This added $5000 
for band concerts in the metropolitan district of Boston. 
The bill went to the governor, and was signed by him 
on April 23 as Chapter 153 of the special acts of 1919. 
As finally signed it carried $35,060,375.47, or $115,711.25 
more than the budget bill as reported by the house ways 
and means committee. 

Supplemental Budgets. 

The budget amendment to the constitution provides, — 
"The governor may at any time recommend to the gen- 
eral court supplementary budgets which shall be subject 
to the same procedure as the original budget." ^ In 
accordance with this provision, Governor Coolidge sub- 
mitted two supplementary budgets during the 191 9 
session. 

The first was submitted on April 24, the day following 
the passage of the general appropriation bill.^ It carried 
the following recommendations : 

First Supplementary Budget 
Purpose Amount 

Maintenance $359,050.00 

Capital outlay 2,479,285.50 

Interest and Debt 94,529.60 

Total $2,932,865.10 

Each item of the supplementary budget was explained 
in detail by a statement from the supervisor which formed 

* 1918 Amendment 16, sec. 3. * 1919 House Document 1653. 



i86 BUDGET IN MASSACHUSETTS 

the body of the governor's supplemental budget. In 
addition to this explanatory text, the supervisor presented 
a balance sheet as of the end of the fiscal year on the 
basis of appropriations already passed and recommended 
in the supplemental budget; and a detailed statement 
of appropriations already passed classified by the budget 
bill items, analyzed to show salaries and wages, other 
expenses, and capital outlays, and the amounts by which 
the various items affected by the supplemental budget 
would be increased thereby. The five appropriations 
passed in accordance with emergency messages from the 
governor, totaling $355,000, were added to the total, so 
that the supervisor's statement is a complete record of 
appropriations in detail, classified in intelligible form. 
It links the supplemental reconmiendations up with the 
original budget, thus making it possible to examine the 
supplemental recommendations almost as if they had 
been a part of the original budget. 

It is to be noted that the first supplemental budget 
was made up almost entirely of capital outlay recom- 
mendations. This was due to the tardy submission of 
estimates and to the need that developed for pubUc works 
as a help in lessening unemployment. 

The governor's letter of transmittal is more in accord- 
ance with the constitutional and legal requirements than 
was that transmitting the original budget. The success 
of the original budget evidently made the governor more 
ready to admit his legal responsibiHties, and we find him 
saying, in this first supplemental budget : 



EXPERIENCE WITH THE BUDGET IN 1919 187 

"In the general appropriation act, based upon my original 
budget recommendations, approximately $1,600,000 was appro- 
priated for capital outlay. To this sum I now recommend an 
addition of $2,479,285.50.'* ^ 

The governor, however, makes no reference to the addi- 
tional $50,000 requested by the supervisor for the gov- 
ernor's emergency fund, a fund that is chiefly used as a 
transfer account. 

The second supplemental budget is dated July 14, 
ten days before the prorogation of the general court. ^ 
Its purpose was to make appropriations to meet the new 
needs created by the laws of the 191 9 session — the 
salary increases, the new investigations, and the new 
services. The recommendations were as follows : 

Second Supplementary Budget 
Purpose Amount 
Maintenance (including salary increases, new services, investiga- 
tions, etc.) $608,350.00 

Military allowances 200,000,00 

Capital outlays 128,500.00 

Deficiencies 1,467.51 

Total, State purposes 938,319.51 

Metropolitan districts' 80,695.67 

Total $1,019,013.18 

The document itself followed the lines of the previous 
budgets. A letter of transmittal from the governor 
stating, "The sums recommended this time ... are 
those suggested by the supervisor of administration," 

* 1919 House Document 1653, p. 5. Italics are those of the author. 

2 Ihid., 1935. 

3 Of the amount recommended for the metropolitan districts, $5000 was for 
maintenance. No metropolitan district recommendations were included in the 
first supplemental budget. 



i88 BUDGET IN MASSACHUSETTS 

was followed by detailed explanations prepared by Mr. 
Raymond, a balance sheet, and a detailed statement of ap- 
propriations and supplemental recommendations as before. 
A large part of the second supplementary budget may 
be said to be made up of non-administration matters. 
The largest single item of this kind is for $120,500 to meet 
the increase in legislative pay in accordance with Chapter 
239 of the General Acts of 1919 which was passed over 
the governor's veto.^ The next largest item is for $100,000, 
recommended by the supervisor "in connection with 
several bills pending for special highway improvements." ^ 
These were nothing more nor less than the traditional 
*^ private road bills" and were opposed by the governor 
as far as was expedient, though he was not ready to veto 
the acts authorizing them or to exclude them from his 
last supplementary budget recommendation.^ The only 
private harbor bills to be enacted were in the nature of 
investigations, for which $30,000 was appropriated as 
recommended in the two supplemental budgets.* 

The Budget and the Pork-Barrel. 

Private road bills and private harbor bills are the 
more notorious forms of "pork-barrel" legislation against 
which the ways and means committees have been fighting 
during recent years. The end of the war and the removal 

^ House Journal, June lo; Senate Journal, June 12. 

2 House Doc. 1935, p. 15. 

3 Road bills: Special Chapters, 232, 233, 240; General Chapters, 335, 336, 
337> 33^} 339) 34^, amounting in all to $216,000 of which the state will pay 
$118,833.33. 

* Special Chapters 211, Item 329 b ; 242, Item 329 c. 



EXPERIENCE WITH THE BUDGET IN 1919 189 

of the necessity for confining all expenditures to objects 
that would ''help win the war" encouraged a renewed 
effort to raid the state treasury for local purposes. Mr. 
Young, in his budget speech, enunciated in no uncertain 
terms the principles that should be adopted to meet 
this situation. He urged: (i) that no loans should be 
made for highway purposes ; (2) that, except for the 
$1,000,000 of new construction provided in the budget, 
all highway expenses be met from motor vehicle fees ; 
and (3) that no special road bills should be given consid- 
eration by the legislature, but that they be referred to the 
highway commission. In clinching these points, Mr. 
Young said : 

" It should also be pointed out that within the state tax of 
$11,000,000 recommended by the governor as a maximum, 
there can be but a small sum, if any, available for special 
road bills. Bills of this nature serve local and private inter- 
ests, but have little state-wide value. It would seem proper, 
therefore, for the general court to consider whether the time 
has not come for the adoption of a sound poHcy in respect to 
such local matters. The highway commission is an adminis- 
trative board, with expert knowledge of highway needs. 
Under statutes now in force the commission may allot a 
portion of its funds to those local projects which have real 
merit. Many roads have been improved in this way, the wise 
policy of the commission requiring the town and the county 
to share in the expense. The chief criticism of appropria- 
tion bills passed by the federal Congress has been that they 
serve the * pork-barrel' instead of the nation. Special road 
bills are of comparatively recent growth in the general court of 
Massachusetts, and they should be restricted in every possible 



way."i 



^ House Doc. 1370, p. 16, 



I go 



BUDGET IN MASSACHUSETTS 



While Mr. Young was not entirely successful in this 
restriction of special road bills, it is to be noted that no 
loans were made for highway purposes and that the special 
highway appropriations were to be financed from motor 
vehicle fees and that construction was to be undertaken 
only after the fees had been collected. Two of Mr. 
Young^s three principles were thus adopted. It is doubt- 
ful whether this would have been possible without the 
state budget system. 

Appropriations Based on the Governor's Special Messages. 

In addition to the three budgets, Governor Coolidge 
addressed a number of messages to the general court 
asking that immediate provision be made for the following 
emergencies : 



Purpose 


Amount Appropriated 


Chapter or 
Special Acts 


Welcome of soldiers 

Soldiers and sailors commission . . 

Parade 26th Division 

Influenza epidemic . . . . . . 

Suppression of corn borer .... 


$10,000 
10,000 

300,000 

5,000 

30,000 


I 
112 
119 

I 


Total 


$355,000 









Private Petitions for Appropriations in igig. 

There was no decrease in 191 9 in the number of private 
petitions, private members' bills and departmental special 
requests, not contained in the annual estimates, involving 
a charge against the treasury. In the case of certain 
departmental requests, this was due to the requirement 



EXPERIENCE WITH THE BUDGET IN 1919 191 

in chapter 18 of the Revised Laws that all departments 
shall file with the secretary of the commonwealth drafts 
of bills to carry out the recommendations contained in 
their annual reports. Where the recommendation would 
carry a charge on the treasury, the department was thus 
required to ask for the appropriation in the estimates 
for special purposes and also to submit a bill through the 
secretary providing for the appropriation. In other 
cases, departments that failed to submit all their estimates 
to the supervisor tried private petitions as a method of 
securing further appropriations. This practice was 
severely condemned by Mr. Young as an attempt to "ob- 
tain entrance to the pubHc treasury by the back door" 
after a refusal to ** enter by the open door of the budget." ^ 
Following Mr. Young, the ways and means committee 
refused to consider a dozen or more of these departmental 
petitions. 

The table below indicates the number of petitions of 
one kind or another involving a charge on the treasury. 
It makes no deduction for those which were also included 
in the budget as explained above. 

Petitions Involving a Charge on the Treasury, 19x9^ 



Relating to 


Number of Petitions 


Amount Petitioned 


State Government 

Metropolitan Districts 


166 
46 


$35,151,830.95 
1,340,034.26 


Total 


212 


$36,491,865.21 



1 House Document 1370, p. 6. 

* Based on Mr. Raymond's tabulation. 



192 



BUDGET IN MASSACHUSETTS 



The actual amount petitioned was more than indicated 
here, as many contained no specific amount and are not 
tabulated. 

Total Appropriations of igig Session. 

The following table presents the total appropriations, 
including metropolitan districts, of the 1919 session of 
the general court in comparison with the governor's recom- 
mendations and the revisions of the house ways and means 
committee. 

Appropriations of 19 19 Session * 



Basis 


Governor's 
Recommenda- 
tion 


Ways and 

Means 

Revision 


Appropriation 


Per Cent 
OF Total 
Appropria- 
tion 


Chapter 
Special 


Budget . . . 
ist Supplemental 
2nd Supplemental 
Special Messages 


$35,739,934-45 
2,932,865.10 
1,019,013.18 
Indefinite 


$34,944,664.22 

2,809,802.1s 

1,208,736.01 

355,000.00 


$35, 060 ,3 75-47 

2,713.802.15 

1,208,736.01 

355,000.00 


89.2 
6.9 
3-0 

•9 


153 
211 
242 


Total . . 


$39,691,812.73 


$39,318,202.38 


$39,337,913-63 


lOO.O 





It is significant that no appropriations were based on 
private petition or special departmental request. Every 
single dollar appropriated was based on the governor's 
messages and budgets. Of the total amount appropriated, 
almost 90 per cent is carried in a single bill. The items 
of the two supplemental bills are numbered to correspond 
to the items of the general appropriation bill, so that it is 
a simple matter to tell at a glance the amount appropriated 
for any service or department. It is to be noted that 97 

1 Based on 1919 House Documents, 185, 1653, 1935, 1354, 1732, 1955. 
* See page 190. 



EXPERIENCE WITH THE BUDGET IN 1919 193 

per cent of the total appropriation was passed and signed 
by the governor a month before the close of the session, 
and that 89 per cent was disposed of soon after the middle 
of the legislative session.^ 

The comparative leadership of the governor and the 
house committee on ways and means is shown clearly 
by the table above. The governor's budget recommenda- 
tions were decreased by over half a million dollars by the 
committee, and the recommendations of the committee 
were followed with hardly a change by the legislature. 

^ See page 114. 



CHAPTER X 
BUDGET REFORM IN 1919 

The most important steps toward a better budget 
system in Massachusetts taken during the year 191 9 have 
been described in the last chapter. The experience with 
the first "governor's budget" is in itself the most notable 
single fiscal event of the 191 9 session. There are, how- 
ever, a number of exceedingly important changes in the 
laws of the state which affect the budget directly or in- 
directly. 

New Constitutional Provisions. 

At the November 191 8 elections, at the time of the 
adoption of the budget amendment, three amendments 
were ratified by the people of no small importance to the 
budget. Their effect was first felt in 1 919. 

The 15th amendment limits the purposes for which the 
commonwealth may borrow money, and requires that 
loans for any other purposes shall be authorized only by 
a two-thirds vote of the general court, on a roll call, and 
requires the governor to recommend the term of the loan. 

The 1 8th amendment prohibits the payment of addi- 
tional compensation to members of the legislature for 
service on recess committees, with the single exception 
of a committee appointed to examine a general revision 
of the statutes, and further provides that a legislator 

194 



BUDGET REFORM IN 1919 195 

shall not be appointed to an office created, or made more 
remunerative, during the term for which he was elected. 
This amendment disposes forever of the recess committee 
as a factor in budget preparation. Those who have fa- 
vored such a committee, or some commission embracing 
also members of the legislature, are now estopped from 
any further agitation, it would seem. 

The 19th amendment requires the executive and ad- 
ministrative work of the commonwealth to be organized 
in not more than twenty departments. The reorganiza- 
tion adopted by the general court is outlined below. Its 
effect upon the preparation of departmental estimates 
and their consideration by the legislature cannot but be 
important. 

Among the remaining amendments adopted in 191 8, 
the following deserve attention in connection with those 
already listed : 

I. In the initiative and referendum amendment^ 
it is provided that no petition may make a specific appro- 
priation of money from the treasury, but that the general 
court shall raise by taxation or otherwise and shall appro- 
priate such money as may be necessary to carry into 
effect any law adopted by initiative petition. It is also 
provided that a law which appropriates money for the 
current or ordinary expenses of the commonwealth or for 
any of its departments, boards, commissions or institu- 
tions shall not be the subject of a referendum petition. 

^ Amendment No. i. Initiative Article [II, sec. 2 ; Referendxim Article III, 
sec. 2. 



196 BUDGET IN MASSACHUSETTS 

The initiative cannot be used to upset the budget pro- 
cedure of the commonwealth ; and the referendum can 
only be used with "specials" and capital outlays. 

2. The 9th amendment allows the governor to return 
to the legislature for further consideration any act or 
resolve with his recommendation for its amendment. 
This would clearly apply to the textual sections of appro- 
priation acts and loans. 

3. The amendment providing biennial elections will 
perhaps help to stabilize the departments affected and 
thus help the budget movement along. ^ The amend- 
ment allowing the general court to take a recess for not 
more than thirty days, might be put to good use as a time 
for public hearings on the governor's budget.^ 

Changes in Budget Law and Practice in 1Q19. 

During the 191 9 session a number of changes in the 
laws affecting the budget were enacted in the attempt to 
make the budget system more satisfactory. 

In order that there might be no seeming contradiction 
between the budget act of 191 8 and the budget amend- 
ment, Chapter 52 of the General Acts of 191 9 was passed. 
The bill was initiated by the house ways and means com- 
mittee, and amends the law so that the date for the sub- 
mission of the budget by the governor is "within three 
weeks after the general court convenes" — the exact 
phrase used in the constitutional amendment. 

The law requiring state departments, boards and com- 

* Amendment No. 17. « Ihid.y No. $. 



BUDGET REFORM IN 1919 197 

missions to file with the secretary of the commonwealth 
those parts of their annual reports which make specific 
recommendations, together with drafts of acts to carry 
them into effect, resulted in 191 9, as we have seen, in the 
introduction of a number of departmental requests for 
appropriations either in duplication of the budget, or 
supplementary to the budget. In order to prevent this 
in the future. Chapter 13 of the General Acts was passed, 
on the initiative of Mr. Young. This act specifically 
exempts from the law above ''those parts [of annual re- 
ports] which . . . are required to be covered by estimates 
submitted to the supervisor of administration.^' This 
law, together with the example which Mr. Young made 
of the extra-budgetary requests of certain departments 
in 1 91 9 will undoubtedly result in the presentation from 
now on of all departmental needs through the budget 
and through the budget alone. 

Inasmuch as the fiscal year in Massachusetts begins 
on December i, and the general appropriation act cannot 
pass much before the following April, some system of 
''votes on account" is clearly necessary. Uj) until 191 91 
this situation had been taken care of through the passage 
of annual resolves, when the statutory extension of author- 
ization to spend on account through December and Janu- 
ary had expired without the passage of the annual appro- 
priations. On the initiative of Mr. Young, there was 
passed in 191 9 an Act providing: 

"Boards, commission, officers and officials having charge of 
expenditures in behalf of the commonwealth may continue 



198 BUDGET IN MASSACHUSETTS 

expenditures in each year at the rate of the appropriation 
authorized for the preceding year until the general court 
makes an appropriation therefor or provides otherwise." ^ 

It is generally understood that a failure to appropriate 
funds before adjournment would constitute a "provision 
otherwise," though other interpretations are clearly 
possible. 

Section 3 of the general appropriation act of 191 9 pro- 
vided that the unexpended balances of the various war 
emergency lump sum appropriations granted to the 
governor and council should lapse into the treasury. Mr. 
Young stated that these balances totaled $1,292,603.40 
out of appropriations of $3,000,000, and said : 

"This method of appropriating money for any purposes 
approved by the executive was necessary and proper in the 
stress of war, when no man can foretell the uncertainties of the 
morrow. It is not a proper method in time of peace." ^ 

While this provision is not especially revolutionary, 
it is indicative of the unwillingness of the legislature to 
let slip the reins of financial control. 

The legislative procedure for the reference, reporting, 
consideration, and enactment of the budget appropria- 
tions was not materially different from that used in the 
disposition of other business. No new legislative rules 
were adopted. This has been left for the future. On 
the eve of the presentation of the general appropriation 
bill for debate in the house, the following order was passed, 
on motion of Mr. Yoimg : 

* General Acts, Ch. 20. * 1919 House Document 1370, p. 21. 



I 



BUDGET REFORM IN 1919 199 

^^ Ordered J That, after the bill making appropriations for the 
maintenance of departments, boards, commissions, institu- 
tions, and certain activities of the commonwealth, for interest, 
sinking fund and serial bond requirements and for certain 
permanent improvements (House No. 1354) has been read a 
third time, the various items in section 2 shall be called in order, 
and those not passed for debate shall stand approved and unde- 
batable until those which may be passed for debate shall have 
been disposed of ; and that all items so passed for debate shall 
be printed, under their respective captions, in the orders of 
the day for the succeeding session, and shall be considered and 
disposed of in order." ^ 

By long established custom in Massachusetts, the 
orders of the day which no member cares to bring up for 
discussion are disposed of before the controversial meas- 
ures. As the presiding officer announces the next matter, 
or as the clerk proceeds to read the title, a member desir- 
ing to bring the matter up for discussion calls ^'pass," 
and the presiding officer then "passes" the matter and 
goes on to the next without calling for a vote at the time. 
When all matters have either been disposed of or 
"passed,'' the latter are considered in order. It will 
be seen that Mr. Young's order merely took over this 
procedure for the consideration of the items of the general 
appropriation bill. The day's postponement also served 
to give him an opportunity to know what items he would 
be called on to defend or explain, and the fact that they 
were printed in the orders of the day made th(;ir 
systematic consideration more possible. 

^ House Journal, p. 360. 



200 BUDGET IN MASSACHUSETTS 

Reorganization of the Executive Departments. 

The 19th amendment to the constitution, ratified by 
the people at the November, 191 8, elections, provided for 
a reorganization of the executive and administrative work 
of the commonwealth in not more than twenty depart- 
ments. Governor Coolidge in his inaugural address 
called upon the general court to enact the necessary legis- 
lation. "This will require," he said, "much legislation 
and a careful working out of many details. I urge 
you to start upon this most important work and complete 
it this session. It should result in diminishing the ex- 
penses of administration." ^ 

The supervisor of administration also urged the matter 
and presented, in slightly revised form, the consolidation 
plan which had been drawn in his office and by the joint 
special committee on finance and budget procedure 
in 19 1 8. The legislature appointed a joint standing 
committee on administration and commissions and re- 
ferred to them the problem of reorganization. This 
committee held a number of public hearings late in Febru- 
ary and early in March but did not report its omnibus 
consolidation bill till June 6.^ In the interim a great deal 
of "negotiation" was of course inevitable. The various 
state officials were, however, conspicuously absent from 
the lobbies and committee rooms, due, it is said, to a state- 
ment from the governor that any attempt by departments 
to influence the reorganization plans would necessitate 
drastic action on his part. 

1 1919 Senate Document i, p. 19. ^ 1919 House Document 1830. 



BUDGET REFORM IN 1919 201 

The consolidation and reorganization bill of the com- 
mittee on administration and commissions was amended 
in the house and again in the senate, but its main out- 
lines remained unaltered. It was finally enacted and 
signed by the governor as Chapter 350 of the General 
Acts of 1919 on July 23, the day before prorogation. 

The Reorganization Act. 

As it was beyond the power of the legislature to reor- 
ganize the constitutional offices, little change was pos- 
sible in the offices of the secretary, the treasurer, the 
auditor, and attorney-general, except in the reassignment 
of certain minor functions governed by law. Among 
the remaining departments, boards and commissions, 
however, the reorganization was more thorough. Of 
these hundred odd independent units, 33 were abolished 
outright and their duties transferred to the newly estab- 
lished departments. Of these 33, 21 were boards and 
commissions, and 12 were single-headed offices. The 
remaining organizations were carried bodily into the new 
departments as bureaus, divisions, or sections. As a result 
of the new bill the. folio wing departments are created : 

The Governor and Council. 

Department of the Secretary of the Commonwealth. 
Department of the Treasurer and Receiver General. 
Department of the Auditor of the Commonwealth. 
Department of the Attorney-General. 
Department of Agriculture. 
Department of Conservation. 
Department of Banking and Insurance. 
Department of Corporations and Taxation. 



202 BUDGET IN MASSACHUSETTS 

Department of Education. 
Department of Civil Service and Registration. 
Department of Industrial Accidents. 
Department of Labor and Industries. 
Department of Mental Diseases. 
Department of Correction. 
Department of Public Welfare. 
Department of Public Health, 
Department of Public Safety. 
Department of Public Works. 
Department of Public Utilities. 
The Metropolitan District Commission. 

The organization of these different departments varies 
radically. The first five including the council are elected 
biennially, under the new amendment. The balance 
are all appointed by the governor with the approval of 
the council. The governor and council also appoint 19 
bureau chiefs directly, thus breaking through the control 
of the department heads. The department of banking 
and insurance is divided into three separate departments 
and the department of civil service and registration into 
two, each with a head appointed by the governor and 
council. In each case the component departments are 
instructed to "act as a board in all matters concerning 
the department as a whole," a phrase intended to save 
the face of the consolidation act, it would seem, by mak- 
ing it possible to count the five departments as two, thus 
keeping the total down to 20, as required by the consti- 
tution. 

The terms of the heads of the departments, cotmting 
the department of banking and insurance as three and the 



BUDGET REFORM IN 1919 



203 



department of civil service and registration as two, arc 
as follows : 





Term 




2 Years 


3 Years 


S Years 


7 Years 


Number of Department Heads 


6 


9 


8 


I 



Salary rates are similarly diversified. They are as 
follows: 



Salary Rate 


Number of Department Heads ^ 


$ 1,500 
5,000 
6,000 
7,000 
7,500 
8,000 
10,000 


1 
9 
4 

I 
6 

I 

I 



Of the twenty-four departments, the predominant type 
of organization is that of a single-headed office. In re- 
organizing certain of those which were previously boards 
or commissions, however, the type of organization se- 
lected has been that of a commissioner with a board 
attached. The number of departments organized in each 
way is as f oUows : 



Method of Organization 


Number of Departments 


Single head 

Single head, advisory unpaid board . 

Single head, paid board 

Commission 


12 

5 
5 
2 



^ No salar}'- specified for Commissioner of Savings Bank Life Insurance. 



204 BUDGET IN MASSACHUSETTS 

The organization of the governor's department deserves 
attention. The miHtary departments are put directly 
under the governor and council. The supervisor of 
administration is left as at present theoretically under 
the governor and council while a miscellaneous group of 
small independent offices are "placed and shall hereafter 
serve under the governor and council." These include 
the armory commission, the art commission, the state 
ballot law commission, the trustees of the state library, 
the board of appeal from the decisions of the tax com- 
missioner, the commission on uniform state laws, and 
the commissioner of state aid and pensions. This "plac- 
ing'' departments "under" or "in" certain departments 
without requiring any real reorganization is typical of 
many sections of the consolidation law. An example of 
a genuine reorganization is the creation of the new super- 
intendent of buildings under the governor and council to 
be a central purchasing agent for the furniture and supplies 
of all state departments and to administer the state house. 

The Effect of Reorganization on the Budget. 

In spite of the failure of the reorganization bill to make 
the governor the real "chief executive" or to establish 
less than 20 independent administrative and executive 
units or to satisfy most reformers, it is a marked step 
forward in the governmental machine of Massachu- 
setts. The very fact that many related tasks are to 
be brought together in a single grouping will be of 
material advantage. 



^ 



BUDGET REFORM IN 1919 205 

Among the general provisions of the reorganization act 
is the following : 

"All reports required by law to be made by any office, 
board, commission or other governmental organization or 
agency affected by this act shall hereafter be made by the 
executive and administrative head of the department in which 
such governmental organization or agency is placed or to which 
its rights, powers, duties or obligations are transferred." ^ 

This paragraph can mean but one thing so far as the 
annual estimates are concerned. The estimates of the 
various bureaus, divisions, sections and independently 
dangling offices must be approved, signed and defended 
by the executive and administrative head of the depart- 
ment. According to the law, there will thus be annual 
estimates from but 21 departments. If the department 
heads take no interest in revising the requests of their 
subordinates — and in budget preparation the offices are 
clearly subordinate however independent they may be 
otherwise ^ — the situation can be no worse than it now is. 
If, on the other hand, they study their estimates and bal- 
ance the needs of their subordinates, it will make possible 
a more satisfactory budget revision by the supervisor, 
the governor, and the legislature. The great success 
which has attended the careful and efficient work of Dr. 
George M. EJine, director of the commission on mental 
diseases, in the revision of the estimates of his 14 state 
institutions during recent years, is evidence of this. The 
creation of the ojB&ce of the superintendent of buildings 

1 Part I, sec 8. 



2o6 BUDGET IN MASSACHUSETTS 

will also simplify the work of sifting departmental esti- 
mates for furniture and supplies, and may lead to other 
central purchasing efforts. 

The supervisor of administration is to "continue to 
be under the governor and coimcil, as now provided by 
law." ^ While this does not require, it leaves ample room 
for the development of that office as the governor's per- 
sonal staff agency for the preparation of the budget, the 
standardization of salaries, the control of departmental 
printing, and as a general investigatory body. Since 
the supervisor is appointed for three years, it is of course 
possible that a new governor will find a hold-over super- 
visor of the opposition party a difficult man to deal with. 
What may happen to the budget procedure under these 
circumstances cannot be foretold. 

Taken all in all, however, the consohdation act will 
make the administration of the budget system more 
effective in Massachusetts. The ideas of administrative 
organization and executive control which the consolida- 
tion act partially embodies may, in the end, produce far- 
reaching and beneficial results, especially in the field of 
financial administration. 

* Part II, sec. 15. 



CHAPTER XI 

CONSTITUTIONAL CONFLICT OVER THE BUDGET 

IN 1920 

The budget for 1920 was prepared by the supervisor 
of administration under the direction of Governor Coo- 
lidge, and was submitted to the general court on January 
16, 1920. The budget was not presented in person, but 
was transmitted with the following brief letter : ^ 

Executive Department, Boston, January 16, 1920. 

To the Honor able Senate and House of Representatives. 

In compliance with the provisions of the Constitution, which 
provides that "within three weeks after the convening of the 
General Court the Governor shaU recommend to the General 
Court a budget." I submit herewith my budget recommen- 
dations, showing probable requirements for the expenditures 
of $39,300,000. The total estimated available receipts fall 
short by $13,313,720.16 of meeting this amount. I recom- 
mend a State tax of not more than $12,000,000. Any addi- 
tional revenue necessary through requirements of this bud- 
get or by action of the legislature on its own initiative should, 
in my opinion, be provided by special taxes upon present tax- 
able sources other than cities and towns, or by levying such 
new taxes or excises as the General Court may deem advisable. 

CALVIN COOLIDGE. 

Governor Coolidge's recognition of executive respon- 
sibility for the budget in the phrase '^my budget recom- 

^1920 House Document looo, page 5. 
207 



2o8 BUDGET IN MASSACHUSETTS 

mendations " is a clear advance over the irresponsible atti- 
tude indicated in the letter of transmittal of the 191 9 
budget. This recognition of responsibility is entirely 
vitiated, however, by the concluding sentence of the letter 
in which the entire revenue problem is passed on to the 
legislation for solution. 

The lack of public interest in the presentation of the 
governor's budget is indicated by the notice given it in 
the press. The Boston Transcript, for example, which 
later manifested such a genuine interest in the budget 
problems, had no editorial comment to make. The only 
news item is relegated to the last four inches of the next 
to the last column of page 8. Even this brief notice con- 
tains a number of serious inaccuracies due to the misin- 
terpretation of the budget.^ 

The ig2o Budget. 

The 1920 budget follows the form of the 191 9 budget. 
Fifteen pages are devoted to a text explanation of the 
more important problems with which the governor and 
the supervisor were forced to deal in preparing the budget. 
This is followed by tabular material as in 191 9. The 
balance sheet as of the end of the 1920 period is an im- 
provement over that presented the previous year. It 
is to be noted that the 1920 budget is considerably more 
inclusive than any previous budget. The act of 191 9 
preventing the presentation of departmental and insti- 

^ January i6, 1920. 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 209 

tutional requests outside of the budget has served its 
purpose.^ 

The Expenditure Program. 

The controlling policy of Governor Coolidge's 1920 
budget is one of rigid economy. For the maintenance of 
the state departments and institutions two million dollars 
more is recommended for 1920 than was spent in 1919. 
This is to allow primarily for much needed salary increases 
and for higher material costs. In the field of capital out- 
lays the governor is exceedingly strict. His policy is to 
eliminate '^all projects except such as appear to be particu- 
larly urgent or will undoubtedly produce economy in 
maintenance. ' ' The application of this policy has resulted 
in recommendations for new buildings and projects of 
but $2,946,000 as compared with recommendations of 
$4,319,000 in 1 91 9. These figures exclude the metro- 
politan districts, which are covered separately in the 
budget. Among the largest requests rejected after con- 
sideration are the $2,000,000 railroad project of the de- 
partment of public works, the $1,000,000 pier develop- 
ment, and the $593,500 laboratory for the department of 
health. In the case of one institution a request for coal 
handling machinery is refused, but in its place a smaller 
allowance is made for the experimental installation of oil- 
burning instead of coal-burning apparatus. This in- 
dicates the extent to which the supervisor of administra- 

* General Acts of 1919, Chapter 13. Though a considerable number of re- 
quests were filed as usual in addition to the budget recommendations, they 
were returned to the departments by the house committee on rules. 



2IO BUDGET IN MASSACHUSETTS 

tion has gone in revising the estimates and gathering 
data for the governor's budget. 

The recommended appropriations for highway main- 
tenance, improvement and construction amount to 
$3,916,650, all of which is to be financed without the issu- 
ance of bonds. The decision as to where and how this 
large appropriation will be spent is to be left with the de- 
partment- of public works in accordance with the sound 
policy of the immediately preceding years. Nothing has 
done more to abohsh "log-rolling'' and the "pork-barrel" 
in Massachusetts and to inaugurate a consistent high- 
way policy than the provision in the budget of a lump 
sum appropriation for highway purposes to be expended 
under the direction and control of the highway commission, 
which since the consolidation of 191 9 has become a bureau 
of the department of public works. The continuation 
of this policy which makes private road bills superfluous 
is indicated by the governor's budget for 1920. 

One item of the expenditure program demands serious 
criticism. A sum of $1,036,046.51 is '^reserved for recom- 
mendations in the Governor's inaugural message and for 
supplemental budgets." The governor's budget, it is 
to be noted, was presented a week after his inaugural 
message. It would seem essential that he should in- 
clude in his budget, at least in round numbers, the amounts 
which he thought should and could be appropriated for 
the projects he recommended in his inaugural. An execu- 
tive budget presupposes that the executive, no less than 
the departments and institutions, shall include all finan- 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 21 1 

cial plans in the budget. The budget should be as com- 
plete a financial program as the governor can make it. 
Indefinite allowances for unspecified purposes have no 
place in the budget. 

The Revenue Program. 

The governor and his budget makers faced a serious 
situation on the revenue side of the budget. The gover- 
nor's letter of transmittal, reproduced above, calls atten- 
tion to the fact that the budget carries appropriations of 
$39,300,000 with only $38,000,000 of revenues in sight. 
The balance of $1,300,000 is to be provided by "special 
taxes,'' or by lev}dng "such new taxes or excises as the 
General Court may deem advisable." With these words 
the governor declined to put forward a program for meet- 
ing the situation and attempted to shift the leadership 
and the responsibility to the legislature and to its com- 
mittees. 

This refusal of the governor to advance a revenue pro- 
gram to finance his expenditure program is especially 
significant in view of the provisions of the budget amend- 
ment to the constitution and the 191 8 budget statute. 
The constitution provides that "the governor shall recom- 
mend to the general court a budget which shall contain 
a statement of all proposed expenditures of the common- 
wealth for the fiscal year, including those already author- 
ized by law, and of all taxes, revenues, loans and other 
means by which such expenditures shall be defrayed." ^ 

^ Amendments of the Constitution, Art. LXIII, Sec. 2. 



212 BUDGET IN MASSACHUSETTS 

The budget act of 191 8, which, under the constitutional 
provision, is binding on the governor, specifically states, 
^^The budget shall also include definite recommendations 
of the governor as to the financing of the expenditures 
recommended and the relative amounts to be raised from 
ordinary revenue, direct taxes, or loans." ^ The revenue 
recommendations of the 1920 budget can hardly be termed 
"definite recommendations'' or a statement of "all taxes, 
revenues, loans, or other means" for financing the appro- 
priations recommended. 

The revenue shortage forced the governor and the super- 
visor to search every source for additional funds. The 
first step taken was to revise upward the auditor's esti- 
mate of revenues from present taxes. How much more 
revenue was "discovered" by this process it is impossible 
to ascertain from the budget, because the budget revenue 
estimate is classified by departments while the auditor's 
estimate, as printed in the budget, is arranged by sources 
and each contain items omitted by the other. This pro- 
cess of "raising" more revenue merely by revising the 
estimates is not entirely unknown in American finance. 
The supervisor is not to be criticised, however, for making 
these upward revisions unless the actual revenues prove 
to be less than his anticipations. The fact that the 
supervisor has refused to accept the auditor's estimates 
as final must be taken as a point in the supervisor's 
favor. The auditor's estimates have frequently been a 
million dollars or so too conservative. In 191 8 the extent 

^General Acts 1918, Ch. 244. 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 213 

of this underestimate was some $4,400,000 and in 191 9, 
$2,715,000.^ 

The revenue estimates also contain an item of $3,100,000 
to be realized from the sale of the great drydock 
constructed at public expense in Boston harbor. The 
justification advanced for placing these capital funds 
in the general fimd is that at least an equivalent 
amoimt is to be appropriated from that fund for other 
capital outlays and for debt service. A similar trans- 
action is recommended in taking from the sinking funds 
of the commonwealth an alleged surplus of $800,000 
and adding this to the general fund to be used in meet- 
ing maturing bonds. The budget contains no detailed 
statement in support of this estimated surplus of the 
sinking funds. 

The Budget Before the House Committee on Ways and 
Means. 

The governor's budget, on receipt in the house, was re- 
ferred immediately to the house committee on ways and 
means. The usual hearings were undertaken as in 191 9, 
though it is to be noted that the senate and house com- 
mittees sat together for the first time in Massachusetts 
budget experience. Representative Frank E. Lyman was 
now chairman of the house committee in place of Repre- 
sentative Benjamin Loring Young, who though remaining 
a member of the committee, became th*^ Republican 
majority floor leader. 

^ 1918 House Document 300; 1919 House Document 300. 



214 BUDGET IN MASSACHUSETTS 

The ways and means committee found itself in a diffi- 
cult position. The governor's budget made no provision 
for a revenue deficit of over a million dollars. It recom- 
mended also the placing in the general fund of the pro- 
ceeds from the sale of the drydock and the alleged surplus 
in the sinking fimds. The wisdom and constitutionality 
of such action was not clear. This cast a shadow of 
doubt on a further estimated revenue of almost $4,000,000. 
In the face of this perplexing situation, the ways and means 
committee, imder the leadership of Mr. Young, began a 
quest for information. 

On January 20 an order drawn by Mr. Young was 
offered in the house and subsequently adopted calling 
upon the treasurer and the auditor to "investigate and 
report to the House forthwith upon the financial condition 
of all sinking funds established to extinguish any bond 
issues of the Commonwealth. '^ ^ This was followed on 
January 29 by the passage of an order to the auditor to 
furnish the general court full information on the port of 
Boston fund and the financing of the drydock.^ Toward 
the latter part of February, the attorney-general was 
asked for his opinion as to "whether and to what extent 
the $3,107,366.93 which will be received from the Federal 
Government as the purchase price of the Boston Dry- 
dock may legally be considered a receipt into the general 
fund of the Commonwealth, and so be available to meet 
current appropriations made by the General Court. '* ^ 

* 1920 House Journal, January 20. ' Ibid., January 27. 

'1920 House Document 1342. 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 215 

Results of Financial Inquiries. 

As a result of the inquiries directed to the auditor and 
to the treasurer the joint ways and means committee 
was placed in possession of certain very illuminating in- 
formation. 

The sinking fund study appears to bear out the gover- 
nor's statement that a large surplus exists in the sink- 
ing fimds of the direct debt. Computing at 4%, the 
direct debt sinking funds show a surplus of slightly over 
$900,000. At 3-J^%, however, this becomes a deficit of 
$70,000. The contingent debt sinking funds, which the 
governor's budget does not mention, computed at 4% 
shows a deficit of $4,430,000. These computations are as 
of November 30, 191 9, and are based on the assumption 
that all securities held in the various sinking funds will ma- 
ture and be paid to the commonwealth at par in time to 
discharge the indebtedness against which they are held. 
This assumption is unquestionably unsound. Only a part 
of these securities will mature in time, and the fact that 
many millions of dollars of these securities are far below 
par in the market would indicate a serious shrinkage. 
It is to be noted also that the estimated surplus becomes 
a deficit if sinking fund requirements are computed at 
3i% instead of 4%.' 

The drydock study shows that the project was financed 
from bonds to the extent of $2,000,000 and from the 
other funds to the extent of $1,100,000. The bonds 

1 1920 House Document 1339. 



2i6 BUDGET IN MASSACHUSETTS 

issued were part of a nine million dollar loan for port de- 
velopment, of which $7,700,000 is still outstanding.^ 

The Opinion of the Attorney-General, 

The question of the legality of the appropriation for 
general purposes of the proceeds of the sale of the dry- 
dock rendered by the attorney-general is an imusual docu- 
ment. He points out that "a certain portion of the price 
received from the United States for the drydock is the 
proceeds of bonds which are still outstanding and unpaid.'' 
After considerable computation this amount is fixed at 
$1,992,213.85. He then cites Article LXH of the amend- 
ments to the constitution which provides in section 4 : 

"Borrowed money shall not be expended for any other 
purpose than that for which it was borrowed or for the reduc- 
tion or discharge of the principal of the loan." 

And on this basis concludes that the $1,992,213.85 "may 
not be used save for the purposes for which the money 
was borrowed or to repay the loan." 

After completely disposing of the legal and constitu- 
tional question, and after uidicating the extent to which 
the funds in questions may be used, the attorney-general 
proceeds to outline a suggested financial policy for hand- 
ling the entire matter. This is the unexpected feature 
of his opinion. His recommendations are (i) that 
$250,000 be used to meet maturing obligations of the port 
development loan, (2) that $600,000 be appropriated 
from this resource for port development instead of from 

1 1920 House Document 1273. 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 217 

other permanent funds as recommended in the gover- 
nor's budget, (3) that $1,000,000 be used to purchase 
highway bonds which it is suggested should be issued 
to finance the highway construction program which the 
governor's budget provides for from current revenues, 
and (4) that the remaining $142,213.85 be used for port 
development or held to apply on the maturjbig port de- 
velopment bonds of 1921.^ Though the attorney-general 
has attempted to guard himself against the suspicion of 
entering the field of financial policy in this opinion, the 
following paragraph indicates the true purport of his 
suggestions : 

"In conclusion, I may suggest that the determination of 
the question submitted to me by your committee must de- 
pend ultimately upon the principles of sound finance rather 
than upon the legal principles involved. By that, I mean, 
that whether the Commonwealth has or has not the power 
under the Constitution to transfer money borrowed for the 
capital account to the income account and to use it for cur- 
rent expenses should not determine the course to be pursued 
by your committee. The General Court has power under 
the Constitution to raise the entire amount required for the 
expenses of the year by a bond issue, making any state tax 
unnecessary and passing on to future taxpayers the burden of 
paying the budget for the current year. To use money received 
from the sale of the property of the Commonwealth, which 
property has not yet been paid for, is an indirect way of ac- 
compUshing the same result. If the principle of using the 
proceeds of the sale of the drydock for current expenses is 
sound, a sale of the Commonwealth Pier to the Federal Govern- 
ment for $5,000,000, and of other property acquired by the 

^ 1920 House Document 1342, page 4. 



2i8 BUDGET IN MASSACHUSETTS 

port development loan would make it possible to do away with 
the state tax altogether or reduce it to an inconsiderable sum. 
The motive which has constrained the General Court to make 
provision for current expenses from current income is as cogent 
to prevent passing on the burden to future taxpayers indirectly 
by a sale of the property of the Commonwealth acquired with 
borrowed money as directly by means of a bond issue. '^ ^ 

The nature of the attorney-general's opinion and his 
specific reference to conferences with members of the joint 
committee on ways and means lead to the conclusion that 
members of that committee had no small part in determin- 
ing the opinion of the attorney-general on the broader 
questions of public finance. 

Public Criticism of the Governor's Budget, 

The attorney-general's opinion of March i made it 
clear that the governor's budget recommendations were 
not only unsound financially on certain matters, but that 
the recommendations concerning the drydock were un- 
constitutional. On March 3 the Boston Transcript in 
its leading editorial discusses the alleged sinking fund 
surplus as well as the constitutional limits on the use of 
the proceeds from the sale of the drydock, and observes 
that the state faces a "crisis of twofold nature" in which 
the choice lies between a sacrifice of the established cus- 
tom of utilizing capital funds for capital purposes alone 
or the increase of the tax burden. The editorial concludes : 

''This choice is so serious and so critical for the State that 
we believe the governor will not hesitate to take his recent 

1 1920 House Document 1342, pages 4, 5. 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 219 

budget recommendations newly under advisement in the light 
of the fresh information which has been brought to bear upon 
them, and to revise them after a fashion which will not only 
make a sound solution of the present difficulty but also com- 
prise an adequate discharge of the responsibility which the 
constitution now imposes upon the governor to recommend 
to the General Court a fully workable statement of ' all taxes, 
revenues, loans and other means' by which the expenditures 
of the year shall be defrayed." 

The implications of the phrase "an adequate discharge 
of the responsibility which the constitution now imposes 
upon the governor ^^ is worthy of note. 

The Boston Herald, imder the heading "Budget and 
Dry dock, '' also comments editorially on the unsatisfactory 
position in which the budget was placed by the attomey- 
generaFs opinion, and observes, "Governor Coolidge will 
not be able to fulfil his hope of keeping the state tax at 
the $12,000,000 level." ^ 

Committee Requests Budget Revision, 

On receipt of the attorney-generaFs opinion, the com- 
mittee on ways and means addressed the following letter 
to the governor, the significance of which is readily ap- 
preciated in the light of events : 

March 3rd, 1920. 

Eis Excellency Calvin Coolidge^ Governor of the Commonwealth. 
Sir: 

I am directed to transmit to you the fo] lowing vote, which was 
unanimously passed at a meeting of the Committee on Ways and 
Means held yesterday afternoon : 

^ March 4, 1920. 



220 BUDGET IN MASSACHUSETTS 

Voted, That in view of the opinion of the Attorney-General 
relative to the funds received from the sale of the Boston 
Dry Dock and the Report of the Treasurer and Receiver- 
General and the Auditor relative to the financial condition of 
the Sinking Funds of the Commonwealth, a letter be trans- 
mitted by the clerk of the committee to His Excellency, the 
Governor, requesting him to submit to the General Court 
a supplementary budget containing a statement " of all taxes, 
revenues, loans and other means " by which the expenditures 
recommended in his original budget message shall be defrayed. 
Respectfully yours, 

H. L. Shattuck, 
Clerk, Committee on Ways and Means. 

The Governor's Revised Budget, 

The attorney-generars opinion, the studies of the audi- 
tor and the treasurer, the public criticism and the vote of 
the committee on ways and means brought the governor 
to a significant revision of his budget. On March 4 he 
wrote to the general court submitting a "new balance 
between estimated receipts and recommendations for 
1920." ^ The new recommendations eliminated the fol- 
lowing items : 

Sale of the drydock $3,107,366.93 

State tax 12,000,000.00 

The indefinite "Special taxes" 1,313,720.19 

Total $16,421,087.09 

and inserted in their place : 

Receipts from the sale of the drydock to be devoted to paying 

port development bonds maturing in 1920 $250,000.00 

Additional levy on inheritances 171,087.09 

Additional levy of corporation income tax 2,000,000.00 

State tax 14,000,000.00 

Total $16,421,087.09 

1 1920 House Document 1350, page i. 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 221 

The revised recommendations thus call for a state tax 
of two millions more than the original budget, and in 
place of the indefinite suggestions of the budget with 
regard to '^special taxes/' the governor recommends a 
substantial increase of the levies on inheritances and on 
corporations. 

The troublesome receipts from the sale of the Boston 
drydock are disposed of as follows under the revised bud- 
get plan : 

To meet port development bonds maturing in 1920 .... $250,000.00 
To the port of Boston fund, to replace appropriations from 

that fund in 1018 to complete the drydock 778,805.34 

To a special fund to be used to purchase and cancel port de- 
velopment bonds under favorable conditions, and pending 
such disposition to be available for investment in other 

bonds or notes of the commonwealth 2,078,561.59 

Total sale price of drydock $3,107,366.93 

It will be seen that this disposition not only conforms 
with the constitutional requirements as interpreted by 
the attorney-general, but that it also meets the criticism 
of the press and of the members of the legislature. 

Restoration of the Constitutional Principal of Executive 
Responsibility, 

Though the financial recommendations of the revised 
budget are by no means unimportant, the truly significant 
feature of this revision lies in its restoration, at least in 
outward form, of the constitutional principal of executive 
responsibility for the budget. In the original budget, 
the governor dodged the issues involved in the revenue 



222 BUDGET IN MASSACHUSETTS 

shortage and passed on to the legislature and its com- 
mittees the solution of the financial problems of the state. 
In the words of the Boston Transcript, the 1920 budget 
did not ^'comprise an adequate discharge of the re- 
sponsibility which the constitution now imposes upon 
the governor to recommend to the general court a fully 
workable statement of ^all taxes, revenues, loans and 
other means' by which the expenditures of the year shall 
be defrayed." As a result of inquiries and pressure by 
the joint committee on ways and means, the governor 
was induced not only to revise certain objectionable finan- 
cial features of his budget, but also to recognize his re- 
sponsibility for the budget and to recommend specific 
methods of raising the revenues to finance his expendi- 
ture program. 

Seen in its proper light this conflict between the gover- 
nor and the legislature over the 1920 budget is a consti- 
tutional struggle of real importance in the evolution of 
the Massachusetts budget. It was a real crisis. If the 
position of the governor in his original budget had been 
allowed to stand unchallenged, and the conception of 
executive irresponsibility there evinced allowed to con- 
tinue, the executive budget system of Massachusetts 
would have been gradually destroyed. 

The leading editorial of the Boston Transcript of March 
5 indicates that the more serious newspapers appreciated 
the fundamental nature of this constitutional precedent. 
After approving of the fiscal policy adopted by the gover- 
nor in his revisions, the editorial concludes : 



CONSTITUTIONAL CONFLICT OVER THE BUDGET 223 

" And the governor's decision involves something more even 
than this. It upholds and supports the new principle of execu- 
tive responsibility for the management of the finances of Mas- 
sachusetts which was proclaimed by a recent constitutional 
amendment. It sets a standard for future governors to ob- 
serve in the assumption of this new responsibility. It squares 
with the best modern concepts of good practice in govern- 
ment." 



CHAPTER XII 

CLASSIFICATION OF THE MASSACHUSETTS BUDGET 

SYSTEM 

What kind of budget system does Massachusetts 
have ? This is a question that may well be asked at the 
close of the story of the development of the budget system 
in Massachusetts. There are those who have said it 
was really a "legislative budget," others have called it 
an " advisory executive budget'' or a "governor's budget," 
and still others, an "executive budget."^ It is clear 
that such a difference of classification must rest primarily 
on a difference of definition of terms. To clear up this 
confusion, the following classification of budget systems 
is suggested as a means of placing the Massachusetts 
system. 

Classification of Biddget Systems. 

A budget system is a system of finance in which expendi- 
tures are made and revenues provided in accordance with 
a plan. If there is no plan, there is no budget system; 
if there is a plan, there is at least the first essential of a 
budget system. An examination of the various budget 
systems indicates that there are four important stages 
through which each budget must pass. These are : 

^ A. E. Buck, National Municipal Review, August, 1919; 1918 House Doc. 
1 185; Joseph Walker, Convention Debates, Vol. 107, p. 130; F. W. Powell, 
Municipal Research No. 91 ; Report of New York Reconstruction Commission, 
1919, p. 305. 

224 



CLASSIFICATION OF THE BUDGET SYSTEM 225 

1. Preparation of the plan. 

2. Authorization of the plan. 

3. Execution of the plan. 

4. Audit of the execution of the plan. 

Each of these activities may be entrusted to various 
authorities of the government. 

An examination of the state budget systems shows a 
wide variety of methods used in the preparation of the 
budget. In some states the governor is responsible, 
in others it is a legislative committee, an administrative 
board, or a commission of legislative and executive offi- 
cers. The authorization of the plan laid down in the 
budget is always entrusted to the legislature, though in 
a few cases restrictions are placed upon the legislature 
in order to prevent any radical reorganization of the bud- 
get plan by the legislature. Responsibility for the execu- 
tion of the plan, after authorization by the legislature, 
depends entirely upon the structure and organization of 
the executive branch of the government. Where the 
executive is composed of a hundred or more independent 
boards, departments, commissions, trustees and officers, 
the responsibility for the execution of the plan is divided 
among as many entities. Where the executive depart- 
ment is unified under the chief executive, he becomes 
responsible for the execution of the plan. The audit of 
the execution of the plan is either entrusted to an officer 
responsible to the governor, or to an executive officer 
independent of the governor, or to an officer responsible 
to the legislature. 



226 BUDGET IN MASSACHUSETTS 

It is thus evident that budget systems classified by the 
preparation of the budget may be of the executive, leg- 
islative, administrative board, or administrative-legis- 
lative board type; while if classified by the agency of 
ratification, they are legislative, or restricted legislative ; 
or when classified by execution they are of the multiple 
executive or unified executive types ; and finally if clas- 
sified by the audit of execution, they are of the executive, 
legislative, or independent auditor type. 

Classification of the Massachusetts Budget System. 

The Massachusetts budget system, as it now stands, 
is not classified easily. The legal provisions may be 
clear enough, but the execution of those provisions leaves 
considerable doubt as to where the real responsibility 
Hes. The preparation of the Massachusetts budget is 
in the hands of the governor. Both the law and the 
constitution are clear on this point. During the first 
year under the new system, however, the governor cer- 
tainly accepted little responsibility. It was shifted to 
the supervisor of administration, and then shouldered 
by the chairman of the house ways and means committee. 
This tendency toward a disintegration of executive 
responsibility for complete budget recommendations was 
checked by the legislature in 1920, so that it may be said 
that in 1920 the governor was responsible for the prep- 
aration of the budget, though the policies adopted in 
the budget were largely those of the legislative leaders. 

The ratification of the budget is entrusted to the legis- 



CLASSIFICATION OF THE BUDGET SYSTEM 227 

lature with the restrictions that the budget recommenda- 
tions shall be embodied in a single bill to have precedence 
over all other appropriations and that appropriations 
not based on the governor's recommendations shall be 
self-financing. 

The execution of the financial plan will be largely in 
the hands of a score of department heads as soon as the 
recently adopted reorganization of the executive branch 
becomes effective. Heretofore it has rested with over a 
hundred independent departments, boards, commissions 
and institutions. The only effective control over the 
department heads is the supervisor's control of salaries 
and appointments. The reorganization fails to place 
the executive responsibility upon the governor through 
its failure to make the terms of ofi&ce of the department 
heads coincide with the governor's, and through its con- 
tinuation of the elected governor's council. This failure 
was intentional so far as the constitutional convention 
was concerned. 

The audit of appropriations and revenue collections is 
entrusted to an elected auditor who is thus independent 
of the governor and of the legislature. 

The present Massachusetts budget system may there- 
fore be classified somewhat as follows: In the prepara- 
tion it is an executive budget system, though the leader- 
ship is legislative ; in the authorization of the plans it is 
of the restricted legislative type ; in the execution of the 
plans it is of the partially unified executive type ; and in the 
audit of the execution it is of the independent auditor type. 



CHAPTER XIII 

OUTSTANDING FACTS IN THE EVOLUTION OF THE 
MASSACHUSETTS BUDGET 

In Massachusetts the evolution of the present budget 
system has extended over a long period. The origins 
of many of its fundamental principles stand recorded 
in the documents and laws of colonial, provincial and 
pre-Revolutionary days. The "budget system," how- 
ever, was never the aim of reformers in Massachusetts 
until within the last decade, and while the chief financial 
reforms of the past have laid the foundations for the pres- 
ent system, there is no evidence to show that there was 
any conscious movement toward a budget system until 
the legislative session of 1910. The following paragraphs 
summarize briefly the more significant events in this 
long development. 

Evolution of Estimates, 

The first general court under the Massachusetts con- 
stitution of 1780 issued to the people of the state a financial 
program and appeal containing an estimate of the prob- 
able needs of the civil and military departments of the 
state government. The next evidence of estimates of 
financial needs is soon after 1800, when regular annual 
estimates are submitted to the legislature by the treasurer. 
The duty of preparing the estimates was transferred to 
the newly created auditor in 1849. In 1858 a very im- 

228 



OUTSTANDING FACTS 229 

portant change was made by the requirement that each 
administrative officer should make his own estimates, 
instead of leaving this task to the auditor. These esti- 
mates were sent by the departments directly to the speaker 
of the house, and by him to the committee on finance. 
From this time on, the estimates had the advantage of 
representing the estimates of the men who were doing the 
work, but they had the disadvantage of ceasing to repre- 
sent a imified plan of expenditures. In 1872 the secretary 
of the commonwealth was made recipient of the estimates 
and was required to publish them "in one document." 
This task was next entrusted to the auditor, beginning 
with 1885. In 1910 the governor was required to receive 
the departmental estimates and to submit them to the 
general court together with his recommendations. This 
first attempt to secure the sifting of the estimates by the 
governor — the first in any state of the Union — failed 
in operation, and the law was repealed in 191 2, when the 
commission on economy and efficiency was created and 
authorized to report to the legislature with regard to de- 
partmental estimates. The commission was replaced 
by the supervisor of administration in 19 16. In 1918 
the budget system was adopted, following the presentation 
of the budget for 191 8 by a recess committee of the 
legislature. 

Authorizations. 

The authorization of appropriations and revenue meas- 
ures has always been a function of the legislature. The 



230 BUDGET IN MASSACHUSETTS 

annual voting of direct taxes goes back to colonial days, 
though the annual voting of appropriations was not 
made all inclusive till 1859, when continuing appropria- 
tions were abolished. The freedom of the legislature 
in voting money bills has been gradually quahfied. 
Special legislative rules were passed to guard against 
ill-considered action on money bills and tax measures 
as early as 1808 ; in 181 6 a date was fixed early in the 
session after which no motion for the grant of money might 
be entertained; in 1858 the house rule was adopted, 
requiring the reference of all appropriation measures to 
a single committee; during the same year the rule was 
established that appropriations might not be passed except 
for objects or purposes aheady authorized by law; and 
finally, in 1 918, it was determined by constitutional amend- 
ment that appropriations based on the budget should 
be gathered together in a single bill with precedence over 
all other appropriations, that private appropriation meas- 
ures should be self-financing, and that the authoriza- 
tion of loans should be restricted. 

Atddit of Expenditures. 

Until 1849 the audit of expenditures and revenues was 
handled by a committee of the legislature and though 
the office of auditor was established at that time, it was 
not until 1855 that he was made independent of the legis- 
lature and the governor by direct election. In 1858 
the auditor's position was materially strengthened; and 
in 1908 he was given power to require the departments 



OUTSTANDING FACTS 231 

and institutions to install uniform accounts and records. 
The actual audit of institutional expenditures was 
unknown until 1908. 

Execution. 

In 1780 a large part of the funds spent by the common- 
wealth were entrusted to committees of the general court. 
Under the new constitution, however, this practice was 
soon discontinued. In 1785 the governor by veto put 
an end to the "Conmiittee to Receive, Concur and Pay 
Accounts," thereby terminating the last important 
executive committee of the legislature. In 1855 the 
nation-wide wave of democracy carried an amendment 
to the constitution making a number of executive officers 
elective, thereby splitting the executive at the source. 
The habit of independent commissions and overlapping 
boards next had its vogue, and in spite of clear and out- 
spoken attacks on the lack of executive responsibility, 
the first efforts at reform were made within the last decade 
and the first results achieved in 1917, 1918, and 1919. 

These dates serve merely to mark the more important 
steps in the development of the present Massachusetts 
budget system and to call attention to its gradual evolu- 
tion. It has been a slow and unbalanced growth. First 
one part of the financial process and then another has 
been recognized as faulty, and has been improved. 

The Dynamic of Budget Reform, 

The most important single force lying back of the im- 
provement of financial procedure and of the adoption of 



232 BUDGET IN MASSACHUSETTS 

the budget in Massachusetts has been the effort to keep 
expenses and direct taxes down. 

In the history of Massachusetts since 1691, there have 
been three distinct efforts to estabhsh financial planning. 
The first of these came to a head in 1733. It was the 
direct result of the "calculating and parsimonious charac- 
ter'' of the people's representatives. It was found that 
a unitary financial system formed an effective means of 
limiting expenditures and controlling executive action. 
In 1858, the second effort was made as a means of decreas- 
ing direct taxation. The final constitutional establish- 
ment of the budget in 191 8, following eight years of direct 
agitation, was the result of an effort to curb the state 
tax and to control the "tremendous increase in govern- 
mental expenditures." ^ 

Legislative Leadership. 

In each of these movements to establish a budget system 
the legislature itself has taken the lead. In 1733, unitary 
financial planning was a method of legislative control over 
executive acts. In 1858, the governor was emphatic 
in his demand for economy, but it was the legislature 
which attempted to establish a unitary financial system 
as a means of securing that economy. In 1910, the first 
efforts toward a budget were made by the legislature, 
and the constitutional amendment of 19 18 was little 
more than a ratification of the budget system already 

1 Representative Benjamin Loring Young, in 19 19 budget speech, House 
Doc. 1370* 



OUTSTANDING FACTS 233 

inaugurated by the legislature. In 1910, 1918, 1919, and 
1920, the prime movers were members of the house com- 
mittee on ways and means. 

The Limits of Public Interest. 

The discussion in the legislature of 191 8 and in the 
constitutional convention, and the vote on the budget 
amendment, show that there is no great popular interest 
or enthusiasm in budget reform. What interest there 
is cuts across both pohtical parties and appears to be that 
of the more progressive public servants and the business 
men of the cities. Their influence was enough to write 
the budget system into the Massachusetts state constitu- 
tion, though the convention was extremely antagonistic 
to any expansion of executive powers. 

The Influence of the Budget Environment. 

In 1 910 Massachusetts tried to make the executive 
responsible for submitting a financial plan to the legisla- 
tiure. The attempt was a failure, and served only to preju- 
dice the legislators against any future increase of the 
governor's powers. This failure was the direct result of 
the personal and pohtical elements and forces which 
formed the setting and environment of the new fiscal 
venture. The governor had no knowledge of budget 
methods or principles and he and the legislature were of 
opposite political parties. This initial breach was mdened 
by the energetic and bellicose character of the chief 
executive. The result was a bitter conflict, a conflict 



234 BUDGET IN MASSACHUSETTS 

the solution of which the Massachusetts constitution 
does not provide. Though the governor was reelected, 
the state was so districted and so organized politi- 
cally that the legislature was each time increasingly 
antagonistic. 

In 1 91 8 the attempt was renewed to make the governor 
responsible for the preparation and presentation of a 
plan for financing the commonwealth. The personal 
and political environment proved more favorable on this 
occasion. No controversy developed between the execu- 
tive and the legislature, in fact the "silent^' nature and 
tactful policy of the governor transferred the real respon- 
sibility for the budget to the chairman of the house com- 
mittee on ways and means, an officer recognized neither 
by the constitution nor by the laws of the state. In 
1920 the governor was forced, after a constitutional strug- 
gle, to reassume responsibility for a complete budget, but 
as in previous years the real financial leadership, as 
reflected in the budget, is that of the house committee 
on ways and means. The personal and political forces 
involved have again exerted a powerful influence on 
budget evolution. 

Three Years of Budget Experience, 

Three years of practice is unquestionably too short a 
time on which to base any very weighty conclusions. 
This is all the more the case as the 191 8 budget was the 
work of a legislative committee. Then, too, 1918 and 
1919 were war years, and war years, even where there 



OUTSTANDING FACTS 235 

is an established budget, have a tendency to derange the 
fiscal system. Nevertheless, the following facts stand 
out clearly in the recent experience of Massachusetts. 

1. The Value of the Budget System, 

The budget system is worth while. It has already 
resulted in an imderstanding and a discussion of the fiscal 
problems of the commonwealth both in the general court 
and in the public press that was previously impossible. 
It has resulted in a more systematic and sounder financial 
poHcy, and is to be credited with having prevented an 
unnecessarily large increase of state expenditures during 
the xmsettled war years. It has been the decisive factor 
in broadening the financial poHcy of the state, thus mak- 
ing it practically impossible to secure, by the familiar 
tactics of log-roUing, the passage of private appropria- 
tions for projects of no advantage to the state as a 
whole. 

2. The Need of a Budget Staff, 

A permanent staff agency responsible for the routine 
work of gathering and sifting estimates is indispensable. 
The experience with the sifting of financial plans and esti- 
mates in 1 9 10 as well as the experience inigiS, 1919, and 
1920 is evidence of this need. WTiether the preparation 
of the budget is vested in a recess committee, the gov- 
ernor, or the ways and means committee, the administra- 
tive and clerical work of preparing the budget must of 
necessity be entrusted to a permanent staff agency. 



236 BUDGET IN MASSACHUSETTS 

3. The Failure of Massachusetts Provisions to Make the 
Governor Responsible for the Budget. 
The budget provisions of the Massachusetts constitution 
and law were intended to make the governor responsible 
for the budget, and to require him to assume the financial 
leadership in the affairs of the commonwealth. In this 
they have failed. The legal and constitutional provisions 
have not created an environment conducive to the de- 
velopment of executive responsibihty for the budget, nor 
has it been possible to fix leadership upon the governor 
by law, when as a matter of fact the real leadership of 
knowledge, experience and ability was to be found in the 
legislature. The governor's control of the executive 
departments, even with the consolidation, is spasmodic 
and subject to the approval of the independently elected 
council, with the result that he neither executes the budget, 
nor has the working knowledge necessary to stand sponsor 
for a well-balanced, rock-bottom plan for financing the 
commonwealth. He is not required to present his budget 
in person and thus to make his responsibihty dramatic and 
personal. He has no right to enter the legislature and 
debate his proposals, nor can he be required to appear in 
their defense. And finally the only budget that is publicly 
advocated before the legislature, under present procedure, 
is the revised plan of the house committee on ways and 
means, and its explanation and defense are in the hands 
of a member of the legislature. While the constitutional 
precedent of 1920 has forced the governor to assume the 
outward form of budget responsibihty; it has not in 



^OUTSTANDING FACTS 237 

reality shifted the financial leadership to him. Under 
present conditions, with present men and present problems, 
the constitutional and legal provisions of Massachusetts 
have not developed a responsible executive budget system. 

The Permanency of the New Biidget System. 

Inasmuch as the present financial system of Massa- 
chusetts is the result of many years of experimentation 
and progress, it is certain that still further developments 
are ahead. An evolutionary view of the past requires 
an evolutionary view of the future. What course these 
future changes will follow can only be conjectured at the 
present time, but one thing appears reasonably certain: 
whatever happens, the budget system has come to stay. 
It is a step forward that will not be retraced. The gen- 
eral court of Massachusetts will never again proceed to 
the consideration of appropriations and taxes without 
first requiring some responsible agency to present a plan 
for controlhng and financing the work of the common- 
wealth. 



APPENDICES 
APPENDIX I 

THE BUDGET AMENDMENT OF THE MASSACHU- 
SETTS CONSTITUTION RATIFIED NOVEMBER, 1918 

Section i. Collection oj Revenue. — All money received on ac- 
count of the commonwealth from any source whatsoever shall be 
paid into the treasury thereof. 

Section 2. The Budget. — Within three weeks after the con- 
vening of the general court the governor shall recommend to the 
general court a budget which shall contain a statement of all 
proposed expenditures of the commonwealth for the fiscal year, 
including those already authorized by law, and of all taxes, rev- 
enues, loans and other means by which such expenditures shall be 
defrayed. This shall be arranged in such form as the general 
court may by law prescribe, or, in default thereof, as the gov- 
ernor shall determine. / For the purpose of preparing his budget, 
the governor shall have power to require any board, commission, 
officer or department to furnish him with any information which 
he may deem necessary. 

Section 3. The General Appropriation Bill. — All appropria- 
tions based upon the budget to be paid from taxes or revenues 
shall be incorporated in a single bill which shall be called the gen- 
eral appropriation bill. The general court may increase, decrease, 
add or omit items in the budget. The general court may provide 
for its salaries, mileage, and expenses and for necessary expendi- 
tures in anticipation of appropriations, but before final action on 
the general appropriation bill it shall not enact any other appro- 
priation bill except on recommendation of the governor. The 
governor may at any time recommend to the general court sup- 

239 



240 APPENDICES 

plementary budgets which shall be subject to the same procedure 
as the original budget. 

Section 4. Special Appropriation Bills. — After final action 
on the general appropriation bill or on recommendation of the 
governor, special appropriation bills may be enacted. Such bills 
shall provide the specific means for defraying the appropriations 
therein contained. 

Section 5. Submission to the Governor. — The governor may 
disapprove or reduce items or parts of items in any bill appropri- 
ating money. So much of such bill as he approves shall upon his 
signing the same become law. As to each item disapproved or 
reduced, he shall transmit to the house in which the bill originated 
his reason for such disapproval or reduction, and the procedure 
shall then be the same as in the case of a bill disapproved as a 
whole. In case he shall fail so to transmit his reasons for such 
disapproval or reduction within five days after the bill shall have 
been presented to him, such items shall have the force of law 
unless the general court by adjournment shall prevent such trans- 
mission, in which case they shall not be law. 



APPENDIX II 

AN ACT TO ESTABLISH A BUDGET SYSTEM FOR 
THE COMMONWEALTH OF MASSACHUSETTS 

Chapter 244 of the General Acts of 19 18 as Amended by 
Chapter 52 of the General Acts of 19 19 

Section i. Every officer or board having charge of any de- 
partment, institution or undertaking which receives an annual 
appropriation of money from the treasury of the commonwealth, 
including annual appropriations to be met by assessments, shal] 
annually, on or before the fifteenth day of October, submit to the 
supervisor of administration statements showing in detail the 
amounts appropriated for the current fiscal year, and estimates 
of the amounts required for ordinary maintenance for the ensuing 
fiscal year, with an explanation of any increased appropriations 
recommended, and with citations of the statutes relating thereto, 
together with such other information, from time to time, as may 
be required by the supervisor of administration. The said esti- 
mates shall not include any estimate for any new or special pur- 
poses or objects not authorized by statute. The officer or board 
submitting the estimates shall file on the same date duplicate 
copies thereof with the auditor of the commonwealth. 

Section 2. Officers, heads of departments, boards, commissions 
and trustees of institutions who, in their annual reports or other- 
wise, recommend or petition for the expenditure of money from the 
treasury of the commonwealth from any source of revenue, includ- 
ing expenditures to be met by assessments or the issue of notes or 
bonds, for any purpose or object not covered by the estimates 
required to be submitted under the provisions of section one of this 
act shall, on or before October fifteenth of each year, submit esti- 

R 241 



242 APPENDICES 

mates thereof in detail to the supervisor of administration, together 
with such other information as he may require from time to time. 

Section 3. The auditor of the commonwealth shall annually, 
on or before the twenty-sixth day of December, prepare and file 
with the clerk of the house of representatives and with the super- 
visor of administration statements of state accounts setting forth 
in comparative tabulations the estimates filed under the provisions 
of section one of this act and estimates of all claims and other ex- 
penditures authorized by the statutes, including interest, sinking 
fund and serial bond requirements, the appropriations for the pre- 
ceding year and expenditures for all state purposes for the preced- 
ing three years. The auditor shall further prepare and file with 
the said clerk and supervisor, on or before the said twenty-sixth 
day of December, his estimates for the ordinary and other revenue 
of the commonwealth in comparative tabulations with the actual 
revenue for the preceding three years, together with a statement of 
the free or unencumbered cash balance and other resources avail- 
able for appropriation. 

Section 4. The supervisor of administration shall study and 
review all estimates and requests for appropriations and other 
authorizations for expenditures of state funds filed with him as 
provided in this act, and shall make such investigations as may be 
necessary to enable him to prepare a budget for the governor, 
setting forth such recommendations as the governor shall deter- 
mine upon. The governor may call upon the department of the 
auditor for information relative to the finances of the common- 
wealth and for assistance in the preparation of the budget. For 
this purpose the auditor may appoint a deputy in his department 
at an annual salary not to exceed thirty-five hundred dollars. The 
budget shall be submitted by the governor to the general court 
annually within three weeks after the general court convenes, and 
it shall embody all estimates, requests and recommendations for 
appropriations or other authorizations for expenditures from the 
treasury of the commonwealth. The budget shall be classified 
and designated so as to show separately estimates and recom- 
mendations for: (a) expenses of administration, operation and 



APPENDIX II 243 

maintenance; (b) deficiencies or overdrafts in appropriations of 
former years; (c) new construction, additions, improvements and 
other capital outlay; {d) interest on the public debt and sinking 
fund and serial bond requirements; and (e) all requests and pro- 
posals for expenditures for new projects and other undertakings; 
and shall include in detail definite recommendations of the gov- 
ernor relative to the amounts which should be appropriated there- 
for. The budget shall also include definite recommendations of the 
governor as to the financing of the expenditures recommended and 
the relative amounts to be raised from ordinary revenue, direct 
taxes or loans. All appropriations based upon the budget to be 
paid from taxes or revenue shall be incorporated in a single bill to 
be designated the general appropriation bill. With the budget the 
governor shall submit to the general court such messages, state- 
ments or supplemental data with reference to the budget as he may 
deem expedient, and from time to time during the session of the 
general court he may submit supplemental messages or recom- 
mendations relative to appropriations, revenues and loans. 

Section 5. Sections three and four of chapter seven hundred 
and nineteen of the acts of nineteen hundred and twelve, as 
amended by chapter two hundred and seventy-eight of the General 
Acts of nineteen hundred and seventeen, and all other acts and 
parts of acts inconsistent herewith, are hereby repealed. 

Section 6. This act shall take effect on the first day of July 
in the year nineteen hundred and eighteen. 



Printed in the United States of America. 



